The lender said it had added an option for landlords to use the higher 5% fee for two- and three-year fixed rates.
Redwood Bank said the change to cost deductions could release an additional £40,000, equal to a 6% increase in loan to value (LTV) for refinancing a buy-to-let (BTL) property.
The firm noted that the option to have a 5% fee on a lower-rate three-year fixed term could help a client refinance a large house in multiple occupation (HMO), with a 15.5% increase in LTV available.
For a commercial deal, an additional 4.9% LTV is available for the client to acquire new premises.
The maximum enhancements in LTV now possible thanks to these changes are:
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- BTL: up to 16% extra LTV
- Semi-commercial: up to 18% extra LTV
- HMO: up to 21% extra LTV
- Commercial: up to 8% extra LTV
Redwood Bank said the changes were crucial to support landlords, especially in the South of England, as rising costs and tighter yields have “limited borrowing potential”.
Mark Dobson, head of business development for the South and London at Redwood Bank, said: “This is exactly the kind of market intervention that landlords need right now. My team in the South have already seen the benefits for our brokers and borrowers, with notable increases in LTVs available. It’s a game-changer for landlords wanting to progress deals and fund their next move.”
He continued: “There’s strong broker interest in these affordability improvements. I spoke to countless brokers at the recent NACFB Expo about the ‘affordability boost’ and how it’s enabling better outcomes for their clients across the country, but especially the South East.”
Last month, the firm reported that its new lending nearly doubled YOY in 2024.
