Across its residential range, the two-year fix at 65 per cent loan to value (LTV) has been cut from 2.99 per cent to 2.89 per cent and the 75 per cent LTV offering has been reduced from 3.29 per cent to 3.19 per cent. 

The five-year fix at 65 per cent LTV has reduced by 10 bps to 3.39 per cent while the 75 per cent LTV product has been cut to 3.54 per cent from 3.69 per cent. These products have a £995 fee. 

Its fee-assisted remortgages have also seen reductions including the five-year fix at 65 per cent LTV which has gone down from 3.99 per cent to 3.59 per cent. 

These products come with a reduced £595 fee, no application fee, a free standard valuation and £250 cashback.  

For buy-to-let borrowers, the lowest two-year fixed rate is the deal at 65 per cent LTV which now has a rate of 2.89 per cent, down from 3.09 per cent.  

George Gee, commercial director at Foundation Home Loans, said: “We have taken this opportunity to make our ranges even more competitive for both landlords and residential borrowers, by cutting a number of our two and five-year fixes by up to 50 basis points.”  

Gee added: “In the residential range particularly, this is an opportunity for advisers who are seeing an increasing number of clients with complex income or multiple income sources, and the self-employed who may have only one-year accounts, to find competitively priced mortgages combined with flexible criteria. 

“Landlord borrowers will also benefit from cuts to various products including our remortgage specials, our early remortgage offering, and those seeking large loans.” 

Masthaven makes changes to bridging range 

Masthaven Bank has revised its bridging range with the addition of refurbishment products and mini bridges.  

The refurbishment range includes a heavy refurbishment option with tailored pricing for different projects.  

There is also a mini bridge product for loans between £200,000 and £300,000, designed for smaller borrowing amounts which need to be deployed quickly. 

Alan Margolis, director of bridging at Masthaven, said: “During the pandemic, bridging has been a vital tool for homebuyers looking to complete purchases quickly, but responsibly.  

“As we navigate a third national lockdown and enduring economic uncertainty, adapting our product offering is vital.” 

“At Masthaven, we want to respond positively to changes in the market and rising demand. These latest updates to our bridging range will allow us to be competitive in the market and offer great service as we work collaboratively during this challenging time,” he added.   

To be eligible the certificate must be dated within the last 12 months, but listed buildings are not included.

For those that qualify, a five-year fix is available at 3.75 per cent up to 75 per cent loan to value (LTV), with £750 cashback on completion and a reduced fee of 0.75 per cent.

The Green Reward remortgage is also available on an early remortgage basis so landlords do not have to wait the usual six months before remortgaging an improved property to the lender.

Foundation said the product is designed to reward landlords who have paid out to make improvements and added that it hoped it would encourage landlords to use the government’s Green Homes Grant initiative to do so.

Foundation Home Loans commercial director George Gee said: “There has already been a real movement to increase the EPC ratings of rental properties, but we’d like to reward landlords who make further progress.

“Once landlords have actively improved the energy efficiency of their properties, we will provide them with access to a product that delivers a very competitive rate, with a reduced fee and a generous cashback which they may wish to use to help offset the costs of the improvements.

“Landlords can achieve a number of positives here, making use of the government grants available, upgrading their properties, creating more energy-efficient homes, while also potentially cutting their tenants’ energy bills.”

Fleet cuts rates

Meanwhile, Fleet Mortgages has cut rates on its two and five-year fixes across its standard, limited company and house in multiple occupation (HMO) ranges by up to 20 basis points (bps).

All 60 per cent LTV products have been moved up to 65 per cent LTV with rates specifically cut on five-year fixes in standard and limited company products where rental calculation is based on the payrate.

The five-year fix payrate products are the same for both standard and limited company borrowers and include:

• 65 per cent LTV – rates cut by 15bps from 3.59 per cent to 3.44 per cent with a rental calculation of 125 per cent at 3.44 per cent.
• 70 per cent LTV – rates cut by six basis points from 3.65 per cent to 3.59 per cent with a rental calculation of 125 per cent at 3.59 per cent.
• 75 per cent LTV – pay-rate product rate cut by 15bps from 3.79 per cent to 3.64 per cent with the rental calculation of 125 per cent at 3.64 per cent.

The lender has also cut rates on its two-year fixes with its new 65 per cent LTV product down to 3.09 per cent from 3.19 per cent, its 70 per cent LTV down to 3.24 per cent from 3.29 per cent and its 75 per cent LTV down to 3.34 per cent from 3.44 per cent.

The HMO range sees a series of price cuts as well including two-year fixes at 65 per cent LTV down to 3.39 per cent and at 75 per cent LTV down to 3.69 per cent, while five-year fixes at 65 per cent LTV and 70 per cent LTV are down to 3.59 per cent and 3.79 per cent respectively.

According to the 846 online interviews undertaken by BVA BDRC between December and January, just 14 per cent of landlords who want to purchase before the end of March will abort a transaction if they are unable to benefit from the tax break.  

Further adding to the sentiment that the stamp duty holiday was not a driving force for landlords, just four per cent said they were purchasing because of it. A quarter said they would hold off purchases in 2021 as they believed incentives had inflated house prices.   

Of those who will continue with purchases, 65 per cent said they were very or quite confident they would complete before the deadline. 

There was still some hope of an extension to the deadline, according to 28 per cent of respondents. Some 31 per cent were less optimistic, saying they did not expect the government to extend the stamp duty holiday.  

Overall, 16 per cent of landlords said they would purchase property over the next 12 months, with the highest share of respondents planning to do so in the first quarter of this year.  

Of those planning to expand their portfolio this year, 48 per cent said they would do so in Q1, likely driven by the tax break. Some 41 per cent intended to purchase in Q2, 28 per cent in Q3 and 29 per cent in Q4. 

George Gee, commercial director at Foundation Home Loans, said: “As we know landlords think long and hard before adding to their portfolios and, as our research reveals, they are unlikely to just confine any purchase activity to the first quarter of this year in order to simply benefit from the stamp duty holiday. 

“There are a number of positive results to come out of our exclusive research, not least landlords’ continued intention to keep on purchasing after the deadline has passed, and the news that many landlords will not abort their transactions if there is no extension and they look unlikely to complete by 31 March.” 

Important times ahead 

Gee added: “In that regard, the next month and a half are very important for the sector. 

“Looking beyond Q1, there will clearly be ongoing opportunities for advisers active in the landlord borrower space, and all the signals point to significant activity taking place in both the purchase and remortgage sectors.  

“We should not forget that many landlords’ special rates are coming to an end over the months ahead, especially those that bought prior to the last stamp duty surcharge increase for additional homeowners back in Q1 2016.”

A two-year fixed at 75 per cent loan to value (LTV) with £999 fee has been reduced by 0.05 per cent to 1.54 per cent and the equivalent option at 85 per cent LTV has been cut from 2.99 per cent to 2.64 per cent. 

For existing borrowers, a two-year fixed at 80 per cent LTV has seen a reduction from 2.04 per cent to 1.99 per cent with a £999 fee. Furthermore, a fee-free five-year fixed product at 85 per cent LTV has been reduced to 2.99 per cent from 3.29 per cent. 

Changes are effective from 10 February. 

Henry Jordan, director of mortgages at Nationwide, said: “In the last year we have spent much more time at home, and it has allowed more people to really evaluate what they want from a property. 

“Whatever people are looking for in their new home, these latest reductions for house purchasers will help make the cost of moving home even more affordable.” 

Foundation introduces 85 per cent LTVs and cuts rates  

Foundation Home Loans has launched two products at 85 per cent LTV and cut rates on mortgages at 80 per cent LTV. 

The new mortgages include a two-year fix with a rate of 4.34 per cent and a five-year fix at 4.69 per cent. Both products have a fee of £995. 

Rate cuts include a two-year fix at 80 per cent LTV which has gone down to 3.64 per cent from 3.79 per cent and its five-year fixed alternative has been reduced from 4.29 per cent to 4.04 per cent. 

For first-time buyers, a two-year fixed mortgage at 80 per cent LTV has been reduced by 10 basis points to 3.79 per cent and a five-year fix has been cut by 20 basis points to 4.19 per cent. These mortgages have a £595 fee. 

George Gee, commercial director at Foundation Home Loans, said: “There is undoubtedly a growing demand in the residential space, and Foundation is looking to meet this demand with keen pricing on our near-mainstream 80 per cent LTV rates, and the introduction of two new options at 85 per cent LTV. 

“With 2020 having a significant impact on many individuals’ income and the financial situation of many existing borrowers, we anticipate an increased number of clients will require specialist residential finance.” 

TML enters Help to Buy 

The Mortgage Lender has expanded its recently launched residential range with Help to Buy mortgages to serve borrowers using the scheme in England and Wales. 

The products have a maximum loan to value of 75 per cent and include a free valuation. The rate for a two-year fix is 3.77 per cent, while the five-year fixed has a rate of 4.2 per cent. 

Steve Griffiths, sales and product director at The Mortgage Lender, said: “After relaunching our residential range a couple of weeks ago brokers said what they really need right now is Help to Buy products for people who have impaired credit, complex income or are self-employed. 

“We’re delighted we’ve been able to act quickly and launch Help to Buy within weeks of returning to residential lending with our core product range.” 

The lender has added to underwriting, new business and sales teams which will also help provide a smoother process for advisers and their clients.

At the start of the year, the specialist lender employed seven new experienced underwriters, after underwriting assistants, processing team members and completions staff also joined the team.

The number of people working in the new business team has now increased by 45 per cent, with many staff remotely recruited and working across the UK, Foundation said.

Foundation’s sales team has also been boosted by new starters, as well as promotions for existing staff, while the lender brought two new internal business development managers (BDMs) in January and a new sales support team member.

At the same time, David Wheatley and Patrick Ogrigri have been promoted to regional account managers in London and South Central respectively and will be looking after intermediaries in those regions.

Sarah Wade was also promoted to head of marketing, with responsibility for driving Foundation’s marketing in 2021 and beyond.

The new recruitment means that, by the end of January, total headcount at Foundation will be up 17 per cent versus the same point last year.

George Gee, commercial director at Foundation Home Loans (pictured), said: “Ensuring we have all the resources required within the business in order to support our adviser partners, and to help us move forward as a lender, has been a key focus over the last few months, and we’ll continue to recruit and promote as required across all teams.

“The next couple of months will undoubtedly be busy from a completions perspective as we work to ensure as many cases as possible can complete before the stamp duty deadline, but we certainly don’t view this as a temporary arrangement.

“Last year was a highly successful year for Foundation and, as a result, our lending ambitions have grown for 2021. It’s why we’ve also increased the numbers and experience within our underwriting and sales team to support the ongoing demand that advisers are seeing in the specialist residential and buy-to-let sectors.”

What locations and how many advisers do you cover in your role?

I have recently been promoted to join our field sales team and am currently looking after 1,138 brokers in the south region.

How have you changed the way you establish and maintain a good relationship with brokers in the pandemic?

The methods of building trusted relationships have not changed that much apart from the obvious inability to meet face-to-face. As before, for me it’s all about being there for the brokers – being transparent and accountable is the key.

What personal skill is most valuable in doing your job?

Time management – I always keep a good time balance to make sure I am contacting as many brokers as I can in a day, while keeping up with the incoming phone calls, Teams meetings and e-mail enquiries. And last but not least, to make sure I’m finished in time for dinner with my growing family.

What personal talent would you most like to improve on?

I’m pretty famous for growing increasingly impressive moustaches for Movember, and my dad-dancing could use some work, but I believe you can continue to improve on any level of talent or skill, and I treat every day as an opportunity to do so.

Where would you rather be stuck, in bumper-to-bumper traffic or back-to-back Zoom calls?

That’s a tough one. Working from home since March I do miss field work, even if it does mean being stuck in the traffic. I’m looking forward to the time when we’re able to do both.

What’s the best bit of career-related advice you’ve ever been given?

Where one door closes, another opens.

What is the most quirky property deal you’ve been involved in?

I have quite a few. I enjoy dealing with large portfolio cases, they come with a variety of different properties and variety of different challenges.

What has been your lockdown coping strategy?

Exercise: run, walk, cycle…move as much as possible.

If you were head of the FCA for the day, what would you change about regulation in the mortgage industry?

I wouldn’t, at least not without consultation from a range of other parties. As far as I am concerned, things are working well so why change it?

What was your motivation for choosing business development as a career?

I was always good at it and enjoyed communicating with people, while my main drive is helping to solve issues and challenges. So, it was a no-brainer.

If you could do any other job in the property sector, what would it be and why?

CEO of Foundation Home Loans, to truly understand what it is like to run a large, successful and rapidly growing company.

What did you want to be growing up?

An astronaut, just like every other little boy in Russia back then.

What’s your favourite face mask design to wear?

Well, the one with Foundation Home Loans logo of course. Always ready to represent.

And finally, what’s the strangest question you’ve ever been asked?

Once or twice I was asked if it’s true that bears walk on the streets of Russia.

In the buy-to-let space Foundation has changed all its products and cut many rates, with reductions of up to 0.20 per cent for houses in multiple occupation (HMOs).

This overhaul includes a range of two and five-year fixed rate remortgage specials at 65 per cent and 75 per cent loan to value (LTV) with a one per cent fee.

The deals start at 3.34 per cent and offer one free standard valuation per case, £250 cashback on completion and no application fee.

Foundation said due to the reduced upfront costs of these products, it believes they will appeal to landlord borrowers seeking to remortgage multiple properties.

Residential first-time buyers

Foundation has also made a number of pricing reductions across its full residential range with cuts from 0.10 per cent to 0.20 per cent.

The lender has also added new first-time buyer products at 75 per cent LTV to complement its 80 per cent LTV options.

First-time buyers with near-mainstream credit can now access rates at 3.49 per cent on a two-year fix and 3.89 per cent on a five-year fix, while first-time buyers with recent credit blips can access rates at 3.79 per cent and 4.19 per cent respectively.

A rolling end-date has been added for all new business products across buy-to-let and residential, meaning upon completion borrowers will benefit from the initial offer rate for the full two or five-year period following completion, rather than at a fixed end date.

Foundation Home Loans commercial director George Gee said: “It’s always our aim to support mortgage advisers with highly competitive rates whether it’s for their landlord or residential clients.

“For landlords our focus is on reducing upfront costs so we have both fee-assisted and flat-fee products with highly competitive rates.

“We’re acutely aware that landlords are looking at ways to refinance their portfolios in order to purchase more, plus there is a greater likelihood of residential borrowers having more complex income needs and circumstances, particularly after their experience throughout 2020.”

The lender said the move to accept the insurance had been made as a result of the very high demand local authorities are seeing for searches as buyers look to beat the Stamp Duty holiday deadline. The demand levels, coupled with staffing issues due to the pandemic, have resulted in local authorities taking longer to return the search results and putting those purchases at risk.

Purchases and remortgages of houses in multiple occupation (HMO) and multi-unit block (MUB) properties are excluded from this new approach however.

In addition, while Covid-19 remains a concern, Foundation has said it will accept search expiry insurance for purchase transactions where searches have reached their six-month maturity.

The lender has also made a host of process simplifications in a bid to speed up processing. These include removing the need for a limited company funding declaration for buy-to-let borrowers, removing the automatic request for bank statements on owner-occupier cases and adapting the residential portal process in a bid to make the affordability and deposit requirements easier, reducing the time needed for underwriting.

Foundation said that these changes have already meant it has doubled the rate of offers issued.

George Gee (pictured), commercial director at Foundation, said that while the lender cannot guarantee that all existing cases will complete before the Stamp Duty deadline, it can simplify its processes and redeploy resources in order to give each case the best chance of getting over the line.

He continued: “We know this is a team effort from all mortgage market stakeholders and that the pressure is on to complete cases before the deadline; we believe that streamlining the process this way will help intermediaries considerably in getting their clients’ purchases to completion within the timescale required while still allowing us to welcome new business now and as we move into 2021. 

“It should mean our intermediary partners can build a strong pipeline of new business to carry them beyond March and we believe our new fee-assisted remortgage products will help them do just that.”

The range is for portfolio and non-portfolio landlords with an almost clean credit history.

All rates have been increased by 0.1 per cent except the two-year fix at 65 per cent loan to value (LTV) which has risen 0.15 per cent.

The new rates are:

• Two-year fix at 65 per cent loan to value (LTV) is now at 3.14 per cent and the 75 per cent LTV version is at 3.34 per cent.
• Two-year variable at 65 per cent LTV is 3.04 per cent and 3.24 per cent at 75 per cent LTV.
• Five-year fix at 65 per cent LTV is 3.34 per cent and 3.59 per cent at 75 per cent LTV.
• Five-year fix large loan is 3.24 per cent at 65 per cent LTV.
• Five-year fix early remortgage at 75 per cent LTV is 3.65 per cent.
• And five-year with three-year early repayment charges at 75 per cent LTV is now 3.74 per cent.

All products have a two per cent fee aside from the large loan which has a 2.25 per cent fee.

Landbay

Landbay has also added two new products to its range, both at 75 per cent LTV.

The pair of five-year fixed rate deals are both available at an interest rate of 3.55 per cent

The first has a free valuation and a maximum loan size of £525,000 and is available on properties up to £700,000, while the second has a maximum loan of £1m.

Howard Reuben, founder of HD Consultants, stressed the importance of building a relationship with lenders to help them understand the story behind a case and not approach it like just another sale. 

Reuben said as underwriters were likely under pressure due to a change in working habits, brokers had “to be professional and friendly even when things go wrong”. 

He added: “Show them solutions, not have arguments. Once this case is gone, you might need them for future cases, so you’ve got to have that relationship.” 

Offer extension 

Reuben recalled how Ipswich Building Society pulled through for his clients based on the strength of their existing relationship. 

The clients were a couple of 36-year-old first-time buyers who managed to save a five per cent deposit. Just before lockdown, they were approved for a 95 per cent loan to value (LTV) mortgage, despite one of the applicants having a blip on her credit score.  

He found most lenders would not accept the case due to the credit report, which resulted from one missed direct debit for a water bill which was immediately put down as arrears.  

“I had to go to the Ipswich because the case needed to be manually underwritten because of a credit issue with one of the applicants. It was a manual, old school all over the desk, broker talking to the underwriter saying, ‘here’s the story, what are your thoughts’ situation,” Reuben said. 

“The wonderful people at Ipswich said ‘not a problem, let’s look at the whole picture. We understand the situation and we’re very happy to proceed with a mortgage application.’” 

The case was provisionally approved, before being escalated to the head underwriter and surveyors were able to inspect the property. 

The UK went into a lockdown to reduce the spread of Covid-19, and the owners of the property the clients were due to move into did not allow any extra inspections to take place. Furthermore, the sale of the property they were downsizing to fell through, and they were unable to go on viewings to find another property. 

A new landscape 

Six months after the mortgage offer was initially issued, the landscape of the market had changed and the 95 per cent LTV mortgage Reuben’s clients secured was no longer available. 

The transaction chain had moved along with the reopening of the property market but just a week before completion, the offer expired. 

“Ipswich honoured [the offer]. They said, ‘we know it’s nothing to do with the clients as the sellers were delaying things. Nothing has changed with their situation’. 

“It’s down to the fantastic relationship my company has got with the Ipswich as well,” Reuben said.  

He added: “They said ‘we want these first-time buyers to get their home’. They pulled through and I’ve now got a photograph which I sent to the underwriter of the day they moved in with the keys and big smiles on their faces.” 

Professional bond 

Reuben’s close alliance and constant communication with Ipswich worked in the clients’ favour so that when it came to extending the offer, as he said the society “didn’t bat an eyelid” about doing so. 

“They know why I’m recommending them as a lender and their product, we’ve got a really good conversion rate with them as a result,” he added. 

He also said it was easier to form these relationships with smaller and specialist lenders as often he knows everyone right up to the CEO. 

This also gave Reuben some leverage when a property was given a zero valuation during a case with Foundation Home Loans. He said the surveyor reported the property as having no EPC after they failed to look on the appropriate website. 

Foundation Home Loans eventually saw where the surveyor went wrong and put the application through. 

Reuben said situations like this could work in the favour of brokers and allow them to show their knowledge in a way that provided solutions. 

He said: “It’s all about having an understanding partnership.  

“We get positive outcomes because we know what we’re talking about, but sometimes we have to direct surveyors and solicitors to the right outcome.” 

“My advice to brokers is respect the bank, give them all the information up front, tell the story. Don’t just fill in fields on a computer because it doesn’t work like that,” he added.