For Buy2Let financing, the model requires that your guaranteed rent is used for payback.
There are 3 scenarios:
Rent Surplus: The guaranteed rent is enough cash to cover the running cost of the property, monthly repayment, and still gives extra cash to the owner.
Rent Fit: The guaranteed rent is just about enough cash to cover the running cost and monthly repayment. No extra cash is paid to the owner except rent earnings increase over time.
Rent Insufficient: The guaranteed rent can only cover the 10% statutory letting and management fee and can cover part of the monthly repayment, the balance of the repayment is covered and paid by the owner to BuySmallSmall monthly.