Foundation Home Loans trims rates and adds 65 per cent LTV green remortgage
The lender has cut the rate for its five-year fix 75 per cent and 65 per cent loan to value (LTV) buy-to-let mortgages by 10 basis points to 3.24 per cent and 3.14 per cent respectively.
Both are subject to a 2 per cent fee. The 65 per cent LTV product comes with a large loan option at 2.99 per cent with a 2.25 per cent fee and maximum loan of £2m.
Its ERC-3 product has also seen a 0.1 per cent reduction to 3.59 per cent, with early repayment charges applicable for the first three years.
The rate for the lender’s early mortgage 75 per cent LTV five-year fixed mortgage now stands at 3.39 per cent and is subject to a 2 per cent fee.
The five-year fixes are available for individuals and company borrowers, with the interest cover ratio set at 125 per cent for limited companies and basic rate taxpayers, and 145 per cent for others.
Foundation Home Loans has also launched a five-year fixed rate Green Reward remortgage at 65 per cent LTV, which has a rate of 3.49 per cent and maximum loan size of £1.5m.
The Green Reward remortgage comes with a 75 per cent LTV option, whose rate has ben cut form 3.65 per cent to 3.59 per cent and has a maximum loan size of £1m.
These loans are available to landlord borrowers on private rental properties with an Energy Performance Certificate of C or above, within the last 12 months. Both the above products come with £750 cashback on completion
Foundation Home Loans commercial director George Gee (pictured) said the rate cuts on its five-year fixes were designed to support advisers and landlord clients, especially if they were looking for a bigger loan, and made its products even more competitive.
“As always, our aim here is to support those landlord borrowers who just miss out on mainstream credit scores and to support our adviser partners as they seek to grow their buy-to-let advice businesses,” he said.
Foundation enhances sales team with a raft of internal promotions
Its former head of sales Mark Whitear has become head of commercial development where he will spearhead strategy for the sales team and grow the lender’s residential offering and commercial opportunities.
He has worked at Foundation Home Loans for nearly three years, and before that was national distribution manager at Kensington Mortgages for just under two years. He has also held senior roles at Fleet Mortgages and CHL Mortgages.
The lender has also appointed former head of national accounts, Grant Hendry, as head of sales overseeing regional and national account managers.
He was worked at Foundation Home Loans for just over three years and before that worked at MortgageGym for nearly a year. Prior to that he worked at Atom Bank and Metro Bank.
Shirli Henry will take on the role of regional sales manager for the South region, having spent three years at Foundation Home Loans underwriting department.
Gavin Kyle will be head of broker services. He was previously internal sales manager for nearly three years and before that worked at Pru Life UK.
The intermediary-only specialist lender has also completed two underwriting academies where eight underwriters completed their training, increasing the lender’s underwriting capacity.
Foundation Home Loans commercial director George Gee said: “As we continue to develop our proposition across both residential and buy-to-let sectors we are growing the personnel within the business to meet increasing demand and have also been able to reward a number of people with richly-deserved promotions.
“It’s always our intention to promote internally if possible, and these new roles and job titles for Shirli, Grant, Mark and Gavin are an indication of their talents and skills, and the huge amount of energy, drive and ambition they bring to the business.”
Foundation cuts fees and First 4 Bridging adds new BTL product
The product fees were lowered to 0.75 per cent, down from one per cent, on the F1 two-year fixed rate at 2.99 per cent, and the F2 homes in multiple occupancy (HMO) two-year fixed rate at 3.34 per cent. Both are up to 75 per cent loan to value (LTV).
The fee was cut to one per cent, down from 1.5 per cent, on the F1 five-year fixed at 3.24 per cent, also with LTV up to 75 per cent.
The new sums represent up to 1.25 per cent off Foundation’s standard fees on buy-to-let products.
The range of loan sizes on all three products is £200,000 to £1m.
George Gee, commercial director at Foundation Home Loans, (pictured) said: “Cutting fees provides and ultra-competitive offer to landlord borrowers for purchase or remortgage. We’re acutely aware that landlords want to keep costs as low as possible.”
First 4 Bridging and Castle Trust
First 4 Bridging and Castle Trust Bank have partnered on a buy-to-let product for first-time and portfolio landlords who are purchasing or remortgaging.
The product has a five-year term, with a two-year early repayment charge at 4.5 per cent.
The loan size range is £150,000 to £2m, and the maximum LTV is 75 per cent.
It covers holiday lets, HMOs, portfolio loans and refurbishments.
There is a two per cent arrangement fee.
Donna Wells, director at First 4 Bridging, said: “We are experiencing a huge uplift in activity across all areas of buy to let. Many landlords are looking for lenders with appetite for lending based on unconventional circumstances. As such, Castle Trust has become a great option, and we expect this to be a popular product.”
Rob Oliver, sales director at Castle Trust Bank, added: “This semi-exclusive product lets landlords refinance or sell after two years without penalty.”
Know Your BDM: David Wheatley, Foundation Home Loans
What locations and how many advisers and broker firms do you cover in your role?
I look after the London postcodes EC and WC which encompasses around 522 brokers at the moment.
How have you changed the way you establish and maintain a good relationship with brokers in the pandemic?
We have adapted with the restrictions in place and have used various video conferencing platforms to meet with our brokers which is allowing a greater turnout.
This coupled with years of experience building relationships over the phones within our internal team has taught me many of the skills I am still able to utilise.
What personal talent/skill is most valuable in doing your job?
Without doubt, being organised.
I think being able to know which cases take priority for brokers allows me to focus on getting the correct results when needed.
This coupled with prioritising policy or product updates to brokers who will be able to benefit means we can be more efficient with their time.
What personal talent/skill would you most like to improve on?
My patience. I like things to do be done quickly and efficiently and need to remember that service level agreements appear in most organisations.
Where would you rather be stuck, in bumper-to-bumper traffic or back-to-back Zoom calls?
Back-to-back Zoom calls as usually the content is engaging.
What’s the best bit of career-related advice you’ve ever been given?
Years ago, I was told there is no such thing as luck and that everything happens due to the work that is put into any situation.
What is the most quirky/unique property deal you’ve been involved in?
To date, it’s been an incorporation of 22 properties that completed on the same day.
What has been your lockdown coping strategy?
I have two small children who are a very good distraction. Lockdown has meant I’ve been able spend invaluable time with them that may have been more difficult otherwise. This coupled with regular exercise.
If you were head of the FCA for the day, what would you change about regulation in the mortgage industry?
Very good question – I would speak to the people across the industry to see what the most significant obstacles to trade would be and try to work a way around this while ensuring people were protected.
What was your motivation for choosing business development as a career?
While working for a mainstream lender I looked at becoming an underwriter, however the role I originally looked at was no longer available.
Business development was an option that was offered which I was unaware existed due to prior ignorance. I think it encompasses a wide range of skills and I love the sales buzz you get from seeing an enquiry go to completion.
If you could do any other job in the property sector, what would it be and why?
I would love to have my own portfolio of properties and be able to watch everything develop. But in all honesty I would still carry on as BDM as I love the role.
What did you want to be growing up?
Growing up I wanted to be a public servant – either a police officer or in the military.
What’s your favourite face mask design/pattern to wear?
I have a bright yellow face mask which is both my favourite colour and coincidentally matches Foundation Home Loans’ branding.
And finally, what’s the strangest question you’ve ever been asked?
There have been numerous strange questions but none jump to mind.
Foundation Home Loans releases 90 per cent LTVs and limited edition deals
The 90 per cent LTVs have been launched within the lender’s F1 range, with the two-year fix priced at 4.99 per cent and the five-year fix at 5.19 per cent. These products have no product fee and a maximum loan size of £500,000.
Its limited edition large loan product is a five-year fixed which offers loan sizes between £500,000 and £2m. It has a rate of 2.99 per cent up and is available up to 65 per cent LTV.
It has a product fee of £1,495 and is available on a capital and interest repayment basis.
Foundation has also launched a limited edition fee-assisted product for both purchase and remortgage. Rates begin at 2.99 per cent for a two-year fixed at 75 per cent LTV and 3.19 per cent for a five-year fixed.
These mortgages offer a free valuation and have no application fees.
The lender has also reduced rates on its two-year discount products by up to 0.2 per cent, with rates starting at 2.69 per cent.
George Gee (pictured), commercial director at Foundation Home Loans, said: “This new product range is designed to support intermediaries in offering more choice of higher loan to value and large loan products to their self-employed clients and those with complex income streams.
“Our expertise and flexible underwriting allow us to open the door for more borrowers to purchase or remortgage with a lower deposit, or to access larger loan amounts, utilising 100 per cent of more types of income.”
He added: “Specialist residential borrowing is likely to grow considerably through 2021 and beyond, and we want advisers to know there is a lender that will fit the bill for the growing number of those clients.”
Foundation green remortgage offers homeowners rewards
The Green Reward range is available to existing homeowners who have achieved an Energy Performance Certificate (EPC) rating C after carrying out home improvements.
Homeowners with an C- rate EPC dated with that last two years, will pay a £595 product fee instead of £995 and will receive £750 cashback on completion.
The green incentives apply to a two-year fixed rate at 3.24 per cent at 75 per cent loan to value (LTV) and a 4.39 per cent at 85 per cent LTV.
If borrowers want to fix their rate for five years, a 3.59 per cent deal and a 4.74 per cent deal are available at 75 per cent and 85 per cent LTV respectively.
The deals are available to borrows who fall outside the high street banks’ credit scoring criteria.
Foundation does not stipulate specific types of improvements which must have been carried out for the owner occupiers to qualify for this remortgage.
George Gee, commercial director at Foundation Home Loans, said: “Having launched our Green Reward remortgage offering for landlords during February, we’re now able to expand our green offer to residential borrowers providing a greater degree of choice for those borrowers who are not able to access high-street lenders, but who undoubtedly should be rewarded for improving the energy efficiency of their home.”
Foundation cuts rates and launches limited company and short-term let products
The limited edition limited company product is available up to 75 per cent loan to value (LTV) and priced at 3.24 per cent, 10 basis points below Foundation’s core limited company range.
It has a reduced 1.5 per cent fee, an interest coverage ratio (ICR) calculated at 125 per cent of pay rate and a maximum loan amount of £1m.
There is no maximum to the background portfolio size, but a maximum of £3m is allowed with Foundation.
The new short-term let products are a pair of two-year discount variable products at 65 per cent and 75 per cent LTV.
They have discounts of 1.6 per cent and 1.2 per cent giving respective pay rates of 3.49 per cent and 3.89 per cent.
Foundation has also cut rates on current short-term let products, reducing its five-year fix at 65 per cent LTV to 3.99 per cent from 4.19 per cent and the 75 per cent LTV version to 4.29 per cent from 4.79 per cent.
Meanwhile, a series of rate cuts has also been made across a number of its buy-to-let products.
From its standard property F2 range for borrowers with some credit blips, the two-year fixes at 65 and 75 per cent LTV have been reduced by five basis points (bps) to 3.19 per cent and 3.34 per cent respectively.
The five-year F2 versions have been trimmed to 3.39 per cent and 3.54 per cent respectively.
The F2 houses in multiple occupation (HMO) five-year fix at 65 and 75 per cent LTV down 10bps to 3.49 per cent and 3.64 per cent respectively.
All the deals mentioned have a two per cent fee.
George Gee, commercial director at Foundation Home Loans, noted the Budget had resulted in increased activity, particularly from landlords.
“Landlords continue to seek out properties that can deliver strong yield – hence the focus on HMO and short-term lets,” he said.
“And as a lender active in these areas we want to ensure advisers and their clients have access to a highly competitive range, right across the buy-to-let product space.”
Foundation signs legal panel and technology deal with ULS
This will allow Foundation to issue electronic offers and certificates of title to its borrowers. It will also give the lender access to its panel of solicitors and conveyancers.
Paul Saunders (pictured), director of lender services at ULS Technology, said: “We are delighted to have been selected by Foundation Home Loans to manage its solicitor panel and integrate our services to deliver customers with an enhanced homebuying and remortgaging experience.
“Our partnership will enable the delivery of electronic offers and certificates of title to speed up the process and will give Foundation customers access to a greater choice of high quality conveyancing firms with expertise in specialist buy to let.”
He added: “We are looking forward to working together with Foundation to continue to improve the conveyancing process for all involved.”
Sandra Robson-Clark, head of lending at Foundation Home Loans, said: “We are always looking for ways to enhance the experience we offer to our customers and this partnership with ULS technology enables us to deliver increased expertise, speed and security.
“The technology integration will provide benefits for everyone in the process, helping transactions to move with greater efficiency and reliability.”
Foundation adds pair of BTL deals for limited companies
The first is at 2.99 per cent up to 75 per cent loan to value (LTV) and with a fee of one per cent for standard properties.
Additionally, a house in multiple occupancy (HMO) version up to 75 per cent LTV with a one per cent fee is available at 3.34 per cent.
The products for limited company borrowers are designed specifically for clients who just miss out on mainstream credit or criteria.
They are priced at 10 basis points below the core Foundation range, and have half the usual product fee. They are available for purchase and remortgage.
The minimum loan size is £200,000 and the maximum is £1m for both products. They are offered at Foundation’s interest cover ratio (ICR) of 125 per cent at 5.5 per cent.
Foundation sets no limit on portfolio size, subject to a maximum of £3m with itself as lender.
The lender anticipated growing demand as landlords seek to refinance and add to portfolios.
“Over the past five years, a consistent two in ten landlords have used limited companies to purchase further properties in their portfolio, and we anticipate this cohort will be highly active in 2021,” said George Gee, commercial director at Foundation Home Loans (pictured).
“It’s important that intermediaries can access price-competitive limited company products and specialist criteria. Therefore we are cutting rates and fees on these two-year, fixed-rate products specifically to provide greater choice for refinancing or purchasing within a limited company structure.
“This year is shaping up to deliver a high-demand private rental sector, and landlords are already responding by looking for property opportunities. These products should support landlords using limited company structures to develop their property-owning footprint,” Gee said.
BTL lenders and landlords must focus interest in environmentally friendly homes – Gee
However, with growing numbers of people looking to improve their energy efficiency and carbon footprint, demand for green mortgage products is set to rise.
Back in October, a report focusing on green mortgages from the Intermediary Mortgage Lenders Association (IMLA) highlighted that 74 per cent of lenders expected green mortgages to become a larger part of the wider mortgage market in the future.
And as many as one in ten advisers have already noticed a rise in customer interest for this mortgage type since the onset of the Covid-19 crisis.
While nearly a third of lenders planned to or have already launched a green mortgage product, 35 per cent of intermediaries also intend to advise clients on green mortgages in the future.
In addition, 14 per cent of intermediaries have clients who have enquired about or taken out a green mortgage and 13 per cent have seen an increase in green mortgage enquiries since Covid-19.
An encouraging 58 per cent of intermediaries also expect consumer demand for green mortgages to grow in the future.
These are highly positive figures which certainly scream potential, although it won’t all be plain sailing as consumer awareness remains comparatively low.
There are still a number of misconceptions around cost, availability and accessibility which may also restrict initial growth to a certain extent.
A major focal point in the awareness process has to be led by the government. We know that there is a commitment in place to make Britain a carbon-neutral nation by 2050.
Upgrading the UK’s existing housing stock, to make homes across the country more energy efficient, will be critical to that goal.
A greater uptake in green mortgages will prove key in this journey and while there is widespread recognition of this throughout the lending community, we still have work to do to ensure we develop and integrate such products in the right way, with the right kind of backing.
The private rented sector will play a huge role in this and that is why we, as a sector, need to evaluate ways in which we can reward those landlords who are making environmentally friendly choices.
There has already been a real movement to increase the Energy Performance Certificate (EPC) ratings of rental properties, and as a lender we have introduced a green reward remortgage product to help incentivise further progress.
It is designed to work in tandem with the government’s Green Homes Initiative and we believe the move to improve carbon emissions in the property sector remains critical in 2021 despite current challenges.
And with the pandemic offering some insight into a more environmentally friendly world, we could see the mortgage market going greener sooner, rather than later.