Quick answer
From 1 May 2026, the Renters' Rights Act abolished assured shorthold tenancies (ASTs) in England. Every England AST automatically became an assured periodic tenancy— fixed terms and Section 21 “no fault” evictions are gone. Wales and Scotland already use their own separate tenancy regimes and are not affected by this change.
Many buy-to-let mortgage conditions specify that a property must be let on an “Assured Shorthold Tenancy” — and trade press (FT Adviser, 23 July 2026; Mortgage Introducer, 27 July 2026) has reported that plenty of lender paperwork still uses that exact wording, almost three months after the Act took effect. Advisers are recommending landlords get written confirmation from their lender that their letting arrangement still satisfies the mortgage conditions.
In this guide
What changed for tenancies
The Renters' Rights Act came into force on 1 May 2026 and abolished assured shorthold tenancies (ASTs) for residential lettings in England. Existing ASTs did not end — they converted automatically into assured periodic tenanciesunder the Housing Act 1988 framework, with no fixed end date and without the landlord needing to do anything to trigger the conversion. Fixed-term tenancies and Section 21 “no fault” evictions were removed as part of the same reform.
This change is specific to England. Wales moved away from ASTs years earlier, to “occupation contracts” under the Renting Homes (Wales) Act, and Scotland has used Private Residential Tenancies (PRTs), with no fixed term, since 2017. Northern Ireland has its own separate tenancy framework. If your let property is not in England, the AST-specific issue below generally does not apply to you in the same way — though it is still worth checking your mortgage conditions use the correct terminology for your nation.
Why your mortgage terms and conditions matter
Buy-to-let mortgage conditions typically specify exactly what kind of tenancy the property must be let on. This is not boilerplate — it is how the lender defines what counts as an acceptable, standard buy-to-let letting versus something outside their normal risk appetite (a long commercial lease, a licence arrangement, an unregulated tenancy, and so on). For a straightforward England residential letting, that condition has very commonly named the Assured Shorthold Tenancy (AST) specifically.
Because the Act changed the tenancy type in law but did not simultaneously rewrite every lender's mortgage documentation, there is a real gap between what tenancies legally exist in England today and what some lenders' published letting conditions say. Reviewing a cross-section of current buy-to-let lending criteria, references to “Assured Shorthold Tenancy” as the specified, acceptable letting type for England properties remain widespread in lender documentation — consistent with the trade press reporting that paperwork has not fully caught up with the legislation.
To be clear about what this does and does not mean: it is not evidence that any specific lender considers landlords to be in breach, and it is not a suggestion that any named lender has acted improperly. It reflects that tenancy-type wording across the industry is, in places, still catching up to a piece of legislation that took effect only a few months ago — exactly the disconnect advisers have been flagging.
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A short, concrete process rather than a general worry:
- Find the tenancy clause.Locate the letting condition in your mortgage offer or the lender's current buy-to-let terms and conditions — it is usually under a heading like “letting requirements” or “tenancy types”, and it will name the specific tenancy type(s) the property must be let on.
- Check what it says today.Some lenders have already updated their wording to reflect assured (periodic) tenancies; others still name the AST specifically. Either way, check the lender's current published position rather than relying on the wording in an older offer document.
- Ask your lender in writing.A short written query — does my existing tenancy, now converted to an assured periodic tenancy under the Renters' Rights Act, continue to satisfy my mortgage's letting condition — creates a record of the lender's position. Keep the written confirmation on file alongside your tenancy paperwork.
- Repeat for each let property.Portfolio landlords with mortgages across multiple lenders may find different lenders are at different stages of updating their wording, so a blanket assumption based on one lender's answer is not reliable for the rest of a portfolio.
What lenders are likely to do
The most likely and lowest-friction outcome is that lenders update their tenancy-type wording to reflect the Act, treating existing AST-referencing conditions as satisfied by the equivalent assured periodic tenancy that the same letting automatically became. That is the practical, administrative fix trade press coverage suggests advisers expect, and it mirrors how the market has handled comparable tenancy-law changes in Wales and Scotland in previous years — where lenders' criteria came to reference “Occupation Contract” and “Private Residential Tenancy” as accepted alternatives alongside, or instead of, AST wording for those nations.
What is not yet settled, and is worth treating as an open question rather than assuming an answer to, is exactly when each lender updates its documentation, and whether any lender takes a stricter reading in the meantime. That uncertainty is precisely why getting your own position confirmed in writing is the sensible step now, rather than waiting for every lender in the market to finish updating their paperwork.
How this interacts with BTL affordability
The Renters' Rights Act is a tenancy-law change, not an affordability-formula change. Buy-to-let lending is still assessed against the Interest Coverage Ratio (ICR) — commonly 125% to 145% of the mortgage interest, calculated at a notional stress rate rather than the actual pay rate — exactly as covered in our buy-to-let mortgage affordability guide. Nothing about the tenancy-type change directly alters that calculation.
Where it could matter indirectly is underwriting confidence in future rental income — for example if a lender's risk view of notice periods or possession grounds shifts how comfortably they treat ongoing rent as secure — but that is a lender-specific underwriting judgement, not a published change to the ICR or stress-rate framework itself. If you are reviewing options on an existing or new buy-to-let, our BTL mortgage calculator runs your figures against current lender criteria.
Frequently asked questions
Is my BTL mortgage invalid now?
Not automatically. The Renters' Rights Act changed the type of tenancy your tenant holds — from an assured shorthold tenancy to an assured (periodic) tenancy — it did not change or invalidate your mortgage contract with your lender. The practical question is narrower: does your mortgage's letting condition, which may still name 'assured shorthold tenancy' specifically, technically no longer describe the tenancy your property is let on? That is a wording and compliance question to raise with your lender, not a reason to assume your mortgage itself has become invalid.
Do I need to tell my lender?
Most buy-to-let mortgage conditions require you to let the property in line with the lender's specified tenancy requirements, and many require you to notify the lender of changes affecting the letting arrangement. Given that the underlying tenancy type has changed for every England assured shorthold tenancy as a matter of law, it is sensible to proactively confirm your position with your lender in writing and get their acknowledgement on file, rather than wait to be asked. This is exactly what advisers have been recommending in trade press coverage since the Act came into force.
Does this change BTL affordability?
Not directly. The Act changes tenancy law, not the interest coverage ratio (ICR) or stress-rate calculations lenders use to assess how much rental income is needed to support a BTL mortgage — those are unchanged by this legislation. Our buy-to-let affordability guide covers how ICR and stress rates work. Where this Act could interact with affordability indirectly is if it changes how confidently a lender values ongoing rental income (for example around notice periods or grounds for possession) — but that is a lender-by-lender underwriting judgement, not a change to the published affordability formula itself.
Last updated: July 2026
