BTL confidence is growing as investors turn to higher-yielding assets – Armstrong

Mortgage approvals are on the rise, and lenders are starting to refresh their offerings, with more flexible criteria and sharper pricing in some areas. 

Buy-to-let (BTL) investors, while still cautious, are showing signs of renewed confidence too. Many are shifting focus to high-yield regions, and with green upgrades on the radar and lenders offering incentives, it’s all about smart, sustainable investing now. Meanwhile, the Financial Conduct Authority (FCA) is stirring things up with proposed rule changes aimed at making mortgages more accessible and switching easier – especially for those looking to remortgage or reduce their term. 

As usual, let’s take a look at some of the key lender updates from July from across the market.

July’s BTL mortgage updates 

This month has seen Metro Bank launch into houses in multiple occupation (HMOs) and multi-unit freehold blocks (MUFBs) to support more personal and limited company customers. Rates have been announced starting from 3.69% with both percentage and fixed-fee options available. The maximum loan to value (LTV) is 75% and standard BTL interest coverage ratio (ICR) and stress rates apply. There is a maximum of six tenants allowed for HMO and six units for MUFB – each unit must be on a single assured shorthold tenancy (AST) – and Metro will consider less-than-perfect credit profiles. 

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Foundation Home Loans has launched a five-year product in the 85% LTV BTL space, which is available to both individuals and limited companies. This F1 product is priced at 6.49% and has a minimum loan size of £100,000, no product fee and no minimum income requirement. This combination of high-LTV lending and no product fees is designed to appeal to a wide range of borrowers looking to release equity or expand their portfolios.

Darlington Building Society increased its maximum LTV from 75% to 80% across its BTL range, including expat borrowers and holiday let investors, and launched new five-year fixed rates. The increase from 75% to 80% LTV is a direct response to broker feedback and gives more room for landlords needing to raise capital or repurpose a previous residential property. All products benefit from a reduced ICR stress rate of pay rate plus 1%, helping support affordability at the higher LTV.

Mansfield Building Society updated its criteria this month to provide more solutions for clients requiring large loans. They have significantly increased their maximum loan size for BTL and residential lending up to 80% LTV from £50,000 to £1m. The lender has also increased its maximum loan sizes for high-LTV residential lending.

Landbay’s ‘Summer Special’ range of standard BTL mortgage products launched, featuring rates that are up to 0.44% lower than existing products. The five new fixed rate products include three new five-year fixes available up to 75% LTV, with rates starting at 4.35% and two new two-year fixes with rates starting at 4.39%. The ‘Summer Special’ range is available for standard properties and for loans ranging from £30,000 to £2m. 

CHL Mortgages has reduced rates in its CHL 1 limited-edition BTL range by up to 0.32%. Limited-edition two-year fixed rates now start at 2.56% with a 7% fee, and five-year fixes from 4.4% with a 7% fee. There are also reductions of 30bps in the CHL 2 range, where two-year fixed rates now start from 2.59%. The lender has also introduced a new 75% LTV two-year fixed rate product in its CHL 2 range that is priced at 2.66% and comes with a 7% fee, aimed at investors looking to maximise affordability by paying a higher fee upfront.

Specialist residential 

Vida Homeloans has announced the launch of new products and criteria designed to support foreign nationals living and working in the UK. Products are available up to 90% LTV (subject to income requirements), with both two- and five-year fixed options across Vida 6, 24 and 36 credit tiers. There is an expanded list of eligible visas, which includes 12 different visa types.

The Mortgage Lender (TML) has also recently made changes to accommodate non-UK nationals who do not yet have ‘indefinite leave to remain’. If they have UK residency and are employed on a Skilled Worker (formerly Tier 2) or Health and Care visa, they may now be able to obtain a residential or BTL mortgage with TML with proof of a minimum of one year’s residency in the UK, a valid UK work visa (with six months or more remaining), and a minimum income of £50,000. 

And finally, Precise has announced that it is now able to lend up to six times loan to income (LTI) for eligible residential customers at 95% LTV. This includes borrowers with recent adverse and all borrower types, including employed, self-employed, joint borrowers, first-time buyers and homemovers.

There are no restrictions according to professions, as long as the customer meets the internal credit score and affordability assessments.