The loan is offered up to £500,000 at 75% loan to value (LTV) and up to £1m at 70% LTV. The product offers a free mortgage valuation and features an interest coverage ratio starting at 125% at 4%.
John Heron, director of mortgages at Mortgage Trust, (pictured) said: “Longer-term fixed rates are becoming increasingly popular, providing landlords with greater cost certainty as they look to manage the introduction of the new tax changes.
“With interest rates still close to historic lows, now is a good time for landlords to consider the potential advantages of locking in for a longer period.”
Parent Paragon Mortgages introduced procuration fees in April for brokers on its range of switch products, but the retention fee will not apply to Mortgage Trust brand products.
The Paragon brand is paying brokers a fee of 0.25% and the fee only pays out where the broker is acting on behalf of the customer in the product switch process.
Lending at Paragon Mortgages more than halved in the first quarter of 2017, dropping from £401m to £185m in 12 months.
The group’s quarterly trading update out in January, which was based on business performance from 1 October 2016 to date, showed that buy-to-let lending picked up in the first quarter compared with three months earlier when it completed on £171m worth of deals.
Overall, buy-to-let lending made up 49% of Paragon’s total originations and investments, down from 67% in the fourth quarter and 87% a year earlier.
At the time, Paragon said it was “still too early” to determine the impact of the Prudential Regulation Authority’s underwriting rules which will be rolled out further from 30 September.