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Buy-to-let market has had ‘hectic start’ to the year – Armstrong

by: Cat Armstrong, Mortgage Club Director, Dynamo for Intermediaries
  • 28/01/2022
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Buy-to-let market has had ‘hectic start’ to the year – Armstrong
The buy-to-let (BTL) market has seen an eventful start to 2022 with a launch North of the border, a swathe of positive rate shifts and some criteria enhancements which are sure to pique landlord interest across the UK.

Let’s start by heading North with the news that Foundation Home Loans has expanded its BTL and residential mortgage offering to borrowers purchasing or remortgaging properties in Scotland. This has been announced along with a full reprice of both their BTL and residential core ranges featuring reductions of up to 0.55 per cent.

Sticking with rates, Paragon has reduced rates across 20 offerings within its BTL  product range. With rates starting at 2.85 per cent, the specialist lender is offering a selection of two and five-year fixed rate BTL mortgages. The products are available between 60 per cent and 80 per cent loan to value (LTV) on both purchases and remortgages.

Landbay has reduced selected BTL mortgage rates and added new-build homes into its green criteria. Highlights of the product refresh include Landbay’s standard five-year fixed rate at 75 per cent LTV reduced to 3.04 per cent, with free valuation options, down from 3.24 per cent.

Molo Finance has reduced BTL rates by up to 19 basis points on limited company and house in multiple occupation (HMO) mortgage products. Limited company and HMO five-year fixed rates now start from 2.37 per cent for 75 per cent LTV, with 65 per cent LTVs starting from 2.95 per cent.

Accord Mortgages has launched a range of five-year fixed rate BTL products with no early repayment charges (ERC).

The range is available on mortgages up to 80 per cent LTV for first-time landlords, existing landlords and portfolio landlords. Notable products include the 65 per cent LTV five-year fix at 2.39 per cent, the 75 per cent LTV five-year fix at 2.93 per cent and the 80 per cent LTV five-year fix at 3.99 per cent.

Zephyr Homeloans has reduced rates across its mortgage product range. The lender is offering 2.84 per cent on a five-year fixed rate standard BTL mortgage at 75 per cent LTV, for properties with a D or E rated EPC. It is also offering lower rates for fixed rate mortgage products at 65 per cent LTV for standard properties, new-build properties and flats above commercial dwellings with an EPC rating between A and C: 2.69 per cent for a five-year term and 2.50 per cent for a two-year term.

Chorley Building Society has re-entered the holiday let market with the launch of two 80 per cent LTV mortgage products. The deals include a two-year fix at 3.04 per cent and a two-year fix at 3.04 per cent with assisted fees for remortgages. The products are available for properties in England and Wales and can be considered on an interest-only basis as well as capital repayment.

Mansfield Building Society has reduced the rates and simplified its BTL mortgage range with four new products, all accepting applications for standard, consumer and limited company BTL with a personal guarantee.


Changes in criteria

Turning our attention to criteria.

Pepper Money has amended its BTL criteria by reducing minimum income requirements to £15,000 for existing landlords and lifting some restrictions around limited companies.

Pepper has also introduced additional changes to make its BTL proposition accessible to a broader group of customers. These include allowing gifted deposits, reducing the required time in current employment from six months to three months and the time required for continuous employment from 12 months to six months.

Finally, Castle Trust has made improvements to its valuation criteria, including that all property portfolios will now be assessed on open market value, freehold blocks up to 20 units will be assessed on aggregate market value, and freehold blocks greater than 20 units will be assessed on investment block value.

This represents quite the hectic start to the new year and long may this continue.

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