Most landlords assume the deposit decides how much they can borrow. With Birmingham Midshires, the deposit usually does not. The rental income does.
We have arranged 251 Birmingham Midshires buy-to-let mortgages over the past five years, placed under the BM Solutions brand the mortgage lender uses for broker business. Half of those cases were at 52% loan-to-value or lower, nowhere near the 75% Birmingham Midshires allows. In case after case, the rent ran out before the deposit did.
Who this is for: landlords buying or remortgaging a rental property, anyone working out how much they can borrow before they apply, portfolio landlords, and anyone who has been told the rental income does not stretch far enough with another mortgage lender.
Why it matters: Birmingham Midshires works out your borrowing from the rent rather than your salary, and the answer changes with your tax band, the length of your fixed rate and how you hold the property. Those choices are worth understanding before you apply, not after.
Birmingham Midshires lends through mortgage brokers only, so you cannot apply directly. We are a fee-free mortgage broker, so applying through us costs you nothing.
How much will Birmingham Midshires lend on a buy to let?
Your loan is based on the lower of the two limits.
The first limit is the deposit. You need 25%, so Birmingham Midshires will lend up to 75% of the property value on standard lending. There is one route to 80%, on a separate product for properties with an EPC rating of C. That product covers personal ownership buy-to-let and let-to-buy only, so borrowing through a limited company is capped at 75% whatever the energy rating. Maximum loan is £1 million at 75% loan to value, rising to £2 million at 50%. The minimum loan is £25,001, and the property must be worth at least £50,000.
The second limit is the rent, and the rent is usually the limit that applies.
Here is how those two limits played out across the 249 cases where we have the figures:
| Loan to value | Cases |
|---|---|
| Under 50% | 104 |
| 50% to 60% | 66 |
| 60% to 65% | 25 |
| 65% to 70% | 19 |
| 70% to 75% | 26 |
| Above 75% | 9 |
Only 35 of 249 landlords borrowed above 70%. Half the loans were under £129,644, and they ranged from £14,995 to £708,764.
Figures from 251 Birmingham Midshires cases arranged by YesCanDo Money between 2021 and 2026.
What does the rent need to cover?
Birmingham Midshires does not lend against your salary the way a residential lender does. Birmingham Midshires looks at the rent and asks whether the rent would still cover the mortgage if interest rates rose.
That test has two parts.
The rental cover ratio. The rent must cover more than the monthly mortgage payment, to leave room for void periods and maintenance. Birmingham Midshires requires 125% for a basic rate taxpayer and 145% for a higher or additional rate taxpayer.
The stress rate. The calculation is not run at the rate you will actually pay. Birmingham Midshires uses whichever is higher of two figures: a nominal rate they set, or the rate you are applying for plus a margin. Both figures depend on the product you choose, and a five-year fixed rate is treated more generously than a two-year deal.
Put those two parts together, and you can calculate the maximum yourself or call us and we will make the calculation for you.
Annual rent ÷ rental cover ratio ÷ stress rate = your maximum loan
A worked example
Take a rent of £1,150 a month, or £13,800 a year, which is the midpoint across our Birmingham Midshires cases, for a higher-rate taxpayer at 145% cover.
On a two-year fixed rate at 4.5%, the margin added to your rate takes the stress rate to 6.5%, which is higher than the nominal figure, so 6.5% is the one used. £13,800 ÷ 1.45 = £9,517, then ÷ 0.065 = around £146,000
On a five-year fixed rate at 5%, a smaller margin applies, so the stress rate lands at 5.5%. £13,800 ÷ 1.45 = £9,517, then ÷ 0.055 = around £173,000
The property is the same, and the rent is the same. Choosing the five-year deal is worth roughly £27,000 of extra borrowing.
The pay rates above are examples. Your own figures depend on the product you are offered, and the nominal rates change, so ask us to run the calculation properly rather than relying on this as a quote.
A rough sense check
If you would rather skip the arithmetic, annual rent worked out at around 9.4% of the loan across the 128 cases where we have both figures. So on a £150,000 mortgage, expect to need somewhere around £1,175 a month in rent.
Your tax band moves that figure. A basic rate taxpayer is tested at 125% rather than 145%, which on the two-year example above lifts the maximum from around £146,000 to around £170,000 on identical rent.
What if the rent does not cover it?
This is where Birmingham Midshires earns its place, and the reason most of our cases end up with them. Three routes are worth knowing.
Top slicing
Top slicing means the lender counts your personal income alongside the rent to bridge a shortfall. Plenty of buy-to-let lenders do not offer top slicing at all.
Birmingham Midshires does, subject to conditions. You need earned income of at least £100,000 per application across the first two applicants, and the case is assessed between 125% and 145% cover. Top slicing is not available to portfolio landlords, on let-to-buy, or through a limited company.
Take a five-year fixed rate
As the worked example above shows, the two term lengths are stressed differently. A five-year fixed rate is assessed at a lower stress rate than a two-year deal, because Birmingham Midshires knows your monthly payment cannot move for five years. The same rent therefore supports a noticeably larger loan, often tens of thousands of pounds more.
We have recommended a five-year fixed rate deliberately in cases where the borrowing was tight, and it is the first thing we look at when the numbers fall short. The trade-off is worth weighing carefully, because borrowing more means committing for longer, and leaving the deal early carries an early repayment charge.
Borrowing through a limited company
A higher-rate taxpayer buying personally is assessed at 145% cover. Through a limited company, the test is 125%. On the same property and the same rent, that gap regularly decides whether the borrowing works at all.
Birmingham Midshires only lends to companies set up purely to hold property, with a maximum of four people who between them own all the shares. How rental profit is taxed is a question for your accountant rather than us.
What changes if you already own several properties?
Once you hold four or more mortgaged buy-to-let properties, lenders treat you as a portfolio landlord and the calculation changes. Birmingham Midshires assesses your whole portfolio rather than just the property you are mortgaging.
Four rules apply that do not apply to anyone else:
- 75% is the ceiling across the entire portfolio, not property by property. A single highly geared property can therefore hold back a case that looks fine on its own.
- The rent must cover 145% stressed at 5.5%, regardless of your tax band. Basic rate taxpayers lose the easier 125% test.
- You need at least £30,000 of earned income, which can include taxable profit from property.
- Top slicing is not available. If the rent falls short, the routes above do not apply to you.
There are also limits on how many properties you can hold: a maximum of ten mortgaged buy-to-lets with other lenders, and five within Lloyds Banking Group, which includes Halifax as well as Birmingham Midshires.
Not every lender will take a portfolio landlord at all. In one of our cases, HSBC could not proceed on that basis, and in another, Santander’s criteria ruled out capital raising for a portfolio landlord, so Birmingham Midshires took both. Our guide to portfolio mortgages for landlords covers how the rest of the market compares.
Client case study: when the best rate could not lend enough
Luke McNally, ceMAP, one of our mortgage advisers, on a recent case.
The situation. My clients were remortgaging a London flat worth £400,000, with £275,500 outstanding, so just under 69% of the value. Both were higher rate taxpayers, which meant the harder 145% rental cover test applied. The rent was £1,600 a month.
What I did. The search returned 106 products. The Mortgage Works came out top on rate at just over 4%, comfortably ahead of Birmingham Midshires.
The problem was that The Mortgage Works would not lend the amount my clients needed on the rental income alone, and The Mortgage Works does not offer top slicing. The best rate on the market was unusable.
Birmingham Midshires came third on total cost and does offer top slicing, so my clients’ combined salaries could be counted alongside the rent. Counting the salaries closed the gap. I also recommended adding the product fee to the loan, because every spare pound was committed elsewhere at that point.
We discussed two and five-year fixed rates and my clients initially chose the five. After talking it through we agreed mortgage rates were likely to fall within that period, so a two-year deal gave them the option to review sooner.
The outcome. Birmingham Midshires issued the mortgage offer five days after the application went in, and the case completed a fortnight later.
Not sure whether the rent will stretch? Send us the rent and the loan you need, and we will tell you which lenders can do it. Speak to an adviser
Will Birmingham Midshires lend to you?
| Must already own a property | At least one applicant needs to own a residential property in the UK. First-time landlords are fine; first-time buyers are not. |
| Minimum income | None to qualify. You must be registered for UK tax with UK-sourced income. |
| Self-employed | Two years of trading with two years of figures. Contractors earning over £500 a day or £75,000 a year can use the gross contract value. |
| Credit scoring | Every mortgage application is credit scored alongside manual underwriting. Birmingham Midshires is not a bad credit lender, and your score affects which products you are shown. |
| Landlord experience | Limited experience goes to an underwriter rather than being declined automatically. |
| Remortgaging | You must have owned the property for at least six months before Birmingham Midshires will consider a remortgage. |
| Portfolio landlords | Accepted, with tighter rules and no top slicing. See the section above. |
| Let to buy | Available if you are keeping your current home, renting it out and buying somewhere new to live. Read more about let to buy mortgages. |
| Property type | Ordinary rental stock let to standard tenants. Across our cases: 103 mid-terrace houses, 57 flats, 42 semi-detached, 20 end-terrace, 10 detached. |
| Leasehold | At least 70 years remaining at application. |
| Unusual property | Strict. Non-standard construction and flats above shops are often better placed elsewhere. |
For current Birmingham Midshires rates, and how they compare with the rest of the market, see our guide to Birmingham Midshires mortgages.
Common questions
Do I need a 25% deposit for a Birmingham Midshires buy to let?
Yes, for standard lending, which caps borrowing at 75% of the property value. One product reaches 80% for properties with an EPC rating of C held in personal ownership.
What is top slicing?
Top slicing lets a lender count your personal income alongside the rent when the rent alone does not cover the borrowing. Birmingham Midshires offers it, subject to £100,000 of earned income across the first two applicants, and it is not available to portfolio landlords, on a let-to-buy, or through a limited company.
What is the minimum income for a Birmingham Midshires buy to let?
There is no minimum income to qualify. Portfolio landlords need £30,000 of earned income and top slicing requires £100,000, but those affect how much you can borrow rather than whether you are eligible.
How difficult is it to get a buy to let mortgage?
It is less difficult than most landlords expect, provided the rent covers the mortgage payment by the required margin. The affordability calculation is what usually stops a case, rather than anything about the applicant.
Does credit scoring affect which products I am shown?
Yes. Every application is credit scored alongside manual underwriting, and your score influences the products available to you. Birmingham Midshires is not a bad credit lender, so a clean recent history is expected. It is worth checking your credit file before you apply.
Can I take a further advance for additional borrowing?
Yes. Existing customers can take additional borrowing through a further advance, which since April 2026 can be applied for alongside a rate switch in one combined application. Our guide to Birmingham Midshires product transfers covers how that works.
How YesCanDo Money can help
Birmingham Midshires lends through mortgage brokers only, so you need one either way.
Before you apply, we calculate how much each lender is likely to offer based on your rental income. When affordability is tight, we identify which lenders allow top slicing, apply more generous stress tests to five-year fixed rates, or assess limited-company applications differently.
We do not charge you a fee. We are paid by the lender on completion. We are family-run, with over 2,400 client reviews averaging 4.9 out of 5.
