Raising Funds to Buy Out a Co Owner on a Buy to Let Property
Buying Out a Buy to Let Co Owner
Your property may be repossessed if you do not keep up repayments on your mortgage.
A fee of up to £495 per mortgage may be charged depending on individual circumstances.
The Financial Conduct Authority does not regulate most Buy to Let Mortgages.
There is no guarantee that it will be possible to arrange continuous letting of the property, nor that rental income will be sufficient to meet the cost of the mortgage.
The information contained within was correct at the time of publication but is subject to change.
4th December 2025
Luke originally purchased a flat with friends as a buy to let investment. Over time, circumstances changed and one of his friends was ready to move on. Luke decided he wanted to take full ownership of the property by remortgaging and raising enough funds to buy out his friend’s share.
Now in his 30s and running his own business, Luke is self employed and a higher rate taxpayer. This meant lenders would assess his affordability differently compared to someone who is a standard rate taxpayer. In addition, the flat had previously been affected by cladding issues, so it was essential to confirm that any potential lender was comfortable with the building before submitting an application.
Looking at His Options
The property had increased in value since it was first purchased, which meant Luke was able to raise the mortgage to 75% of the current value. This allowed him to release the funds needed to buy out his friend.
The flat itself is a small property in a small block. Although there had been cladding concerns in the past, the issues had since been resolved. Even so, this remained a key factor in choosing a suitable lender.
Luke’s income comes solely from his self employment, which required tax calculations and tax year overviews to demonstrate his earnings. He also had a good credit profile with nothing out of the ordinary. There were no pressing time constraints, which gave us the ability to focus on the most suitable lender rather than the speed of completion.
At the time, the market was unsettled due to the Budget announcement and general uncertainty around future rate movements. Luke was clear that he only wanted a two year fixed rate. He plans to review the situation again in two years and may even sell the property, so he did not want to tie himself in for too long.
The main considerations were:
- Finding a lender comfortable with a higher rate taxpayer’s borrowing capacity
- Confirming the cladding situation met the lender’s criteria
- Ensuring the lender was happy to release funds for buying out a co owner
The Recommendation
A two year fixed rate mortgage was the most suitable choice. It gave Luke predictable monthly payments and the flexibility to reassess his options in two years time without committing to a longer tie in.
This structure worked well for his plans, as he has not yet decided whether he will keep or sell the flat in the future.
Outcome
Luke was very pleased with the result. He successfully raised the funds required to buy out his friend and take full ownership of the flat. The previous cladding issues did not cause any problems, and the lender was able to support the application on the terms he needed.
With everything now in place, he has the freedom to decide his next steps over the coming years without being locked into a long fixed rate.
Are You Looking to Buy Out a Co Owner on a Buy to Let Property?
If you own a buy to let property with someone else and are considering buying out their share, or if you need advice on raising funds against a flat that previously had cladding issues, I can help you understand your options and find a suitable solution based on your circumstances.
Get in touch today to explore the possibilities.