Buy to Let Market Update: June 2022
Welcome to ‘Buy to Let Market’, a column aimed at providing you with recent criteria and product updates within the Buy to Let lending markets.
Buy to Let Market Update: -
Landbay – has repriced the first ever exclusive mortgage product for NRLA Members. If you are looking for buy-to-let finance with fixed payments for the next 5 years, this exclusive product has a 0.15% reduction in the pay rate and a £250 Cashback when compared to the lenders core range. This product is fixed for 5 years with a pay rate of 3.29% and is available for the remortgage and purchase of rental property including lending to SPV Limited Companies (Special Purpose Vehicle) and individuals up to 75% Loan to Value.
Leeds Building Society - has announced criteria improvements for Landlords who opt for a 5-year fixed rate term or longer, will now benefit from a decrease in the stress rate for Buy to Let (BTL) mortgages. By decreasing the BTL stress rate from 5.5% to 4.5%, BTL borrowers who want to fix their mortgage for 5 or more years will benefit from a greater borrowing power, giving them more lending options and improved access to 5-year products.
Paragon Bank – has increased their Interest Cover Ratio (ICR) calculation for 5-year fixed rate products which will now be calculated using the amount requested, at either the product charging rate or 4.25% (previously 4%), whichever is higher. All other products will remain at either the product charging rate plus 2% or 5.5%, whichever is highest.
Platform part of The Co-operative Bank – has announced 2- and 5-year fixed rate products have increased by up to 0.16%.
Virgin Money – has announced on all buy-to-let products that rates have increased by 0.20%.
BM Solutions – has announced BTL Remortgage and Let to Buy rate decreases of up to 0.11% across 5-year fixed 60% loan to value (LTV) and 75% LTV, £0, £995, and £1,995 fee products. The lender has also announced rate increases of up to 0.10% across 2-year fixed 60% LTV and 75% LTV, £0, £995, and £1,995 fee products.
For BTL House Purchase there are rate decreases of up to 0.11% across 5-year fixed 75% LTV, £0, £995 and £1,995 fee products and rate increases of up to 0.24% across 2- and 5- year fixed 60% LTV and 5-year fixed 75% LTV £0, £995 and £1,995 fee products.
The Mortgage Works – has increased the maximum LTV for new build flats from 65% to 75%.
Zephyr Homeloans- has reintroduced a 7-year fixed deal into its mortgage product range.
The lender is offering 3.79% on a 7-year, fixed rate, standard buy-to-let mortgage at 65% LTV for properties with an A to C rated energy performance certificate (EPC), and 3.89% on standard properties with an EPC rating of D and E.
Hampshire Trust Bank - has launched a new product for landlords who want to improve the energy performance certificate rating of their properties through refurbishment. The Bridge EPC Refurb offer has the benefit of a light refurbishment bridging product combined with a term loan. The product consists of a 6-month bridging loan followed by a term loan. The bank will also discount its standard rate by 0.20% if the property achieves an energy performance certificate rating of C or above rating after 6 months. In addition, the lender will pay for the new certificate.
Precise Mortgages – has launched a new buy to let mortgage range which includes 2-year fixed rates starting from 2.89% and 5-year fixed rates from 3.44%. The range includes options with fixed, £0 and percentage product fee. Plus, products with refunded valuation (maximum £630) and £500 cashback, which could be ideal for landlords looking to remortgage. There are options for personal ownership and limited company, HMO and limited company HMO landlords with loans up to £3million available.
United Trust Bank – is one of the newest lenders to enter the Buy to Let market. The lender is offering a range of buy-to-let products available to individual, portfolio, limited company SPV and first-time landlords. The lender will aim to help with specialist buy-to-let requirements such as unusual property types including flats that are high rise and over commercial premises, HMOs, multi-unit freehold properties and holiday lets.
Accord Mortgages- has lowered the calculations on interest coverage ratio (ICR) and interest coverage reference rate (ICRR) for landlords who are remortgaging. This will apply to borrowers who do not require additional capital. For landlords wanting to do a like-for-like remortgage, an ICR of 125% will be stressed at 4.5% for basic and zero rate taxpayers. This will apply to all products. For those choosing terms shorter than 5 years, an ICR of 140% will be stressed at 4.5% for higher and additional rate taxpayers, a change from the previous ICR of 135% which was stressed at 5.5%. For higher and additional rate taxpayers fixing for 5 years or longer, an ICR of 145% will be stressed at 4%. This is a change from the previous ICR of 145% being stressed at 4.5%.
For further information on Buy to Let mortgages both for individuals and limited companies please contact NRLA Mortgages on 0161 341 0581 or visit the NRLA website https://www.nrla.org.uk/services/mortgages.
Please note lenders have different minimum criteria requirements and not all landlords and property types will qualify for a specific product. The product rates are correct at the time of writing the article and are subject to change.
This is an advertisement only and in no way should be viewed as a personal recommendation or advice. Before a recommendation of the suitability of the product can be given, we will direct you to 3mc (UK) Limited who can provide independent mortgage advice. As part of this they will ask questions so that they can fully understand your circumstances before giving advice.
NRLA Mortgages is a trading name of LPTE Limited which is an Introducer Appointed Representative of 3mc (UK) Limited who is Authorised and Regulated by the Financial Conduct Authority and is entered on the FS Register under reference 302992.
Please note: 3mc can advise/arrange Business Buy to Let (BBTL) and Consumer Buy to Lets (CBTL). Of the two, only Consumer Buy to Lets are regulated by the FCA.
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