As with standard mortgages, you’ll need to decide whether you want a repayment or interest only mortgage. With repayment mortgages, you pay off the interest and some of the overall cost of the property each month. At the end of your repayment term, you’ll have paid off both the price of the house – the capital, and the interest on it.
The majority of buy to let mortgages are interest only where you pay only the interest on the loan and nothing off the capital. This means that at the end of the term, you will still need to find the funds to pay off the outstanding capital balance.