Buy-to-let fixed mortgage rates fall as trackers rise – Mortgage Brain

According to data from Mortgage Brain, the cost of an average 60% and 70% loan to value (LTV) two-year tracker product has risen 2% in the last three months.

This places average rates at 2.09% and 2.44% respectively and the changes mean an increase of £126 and £162 per year on a £150,000 mortgage.

In contrast 70% LTV two- and three-year fixed rate products and an 80% LTV five-year fix have all come down 2% over the past three months.

In financial terms this offers potential investors and buy-to-let (BTL) borrowers a potential saving of up to £144 over the past quarter, or £432 per year when compared to this time last year.

The average rates for two-year 80% LTV and five-year 60% fixed deal have remained unchanged while a 60% LTV two-year fixed, currently rate at 1.84%, now costs 1% more than in August.

Residential comparison

The analysis also shows the true cost differences between BTL mortgages and mainstream residential products.

A typical 80% LTV five-year BTL fixed is 24% higher than the same product type for a residential mortgage, with the same two-year fix costing 20% more than a residential equivalent.

Meanwhile a 60% LTV two-year BTL tracker costs 12% more.

Mortgage Brain CEO Mark Lofthouse (pictured) said: “With little movement in mortgage costs in the BTL sector over the past three months our latest analysis shows that, while there isn’t too much to get excited about, there are still cost savings to me made with a number of BTL products offering favourable rates.

“The BTL market remains unsettled though and although there are plenty of predictions for further fluctuations over the coming months, any changes to costs and rates are expected to be slow and marginal.”