Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.

Property investors looking for funding face a baffling array of mortgage deals with very little to separate rivals from each other.

Around 700 buy to let mortgages are available direct from lenders or via brokers.

Two-year fixed rate buy to let mortgages take up 54% of all loans offered to landlords, followed by around 20% which are five-year fixed rates and then about 17% are three-year fixed rate loans.

That leaves just about 10% of the market to trackers, standard variable rates another mortgage packages.

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The figures come from the latest market survey by broker Mortgages for Business.

The Mortgage Works (TMW) is increasing its maximum loan-to-value (LTV) for first-time landlords from 75% to 80% starting at an interest rate of 4.14%.

TMW managing director Henry Jordan said: “This move offers another option for those looking to invest in buy-to-let for the first time, further demonstrating TMW’s leadership and commitment to the buy-to-let market.

“With the majority of lenders capping LTV at 75%, this is a positive change that is likely to be welcomed by both intermediaries and buy-to-let customers.”

Earlier this year, the Financial Conduct Authority (FCA) frowned on lenders offering these mortgages, claiming first-time buyers could circumvent mortgage affordability tests by taking out a buy to let mortgage and then living in the home.

Since then, the FCA has relaxed opposition to ‘gaming’, the industry term for taking a mortgage out to avoid stringent lending rules.

One reason could be lenders have agreed behind-the-scenes to carry out electoral role checks within a year of issuing buy to let loans to first time borrowers to make sure they are living in the homes.

Buy to let mortgage lender Paragon has announced a return to the second charge market under the banner of Paragon personal Finance. The company will consider loans between £10,000 and £100,000 from an interest rate of 5.436% at up to 85 % loan to value.

Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.
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1 COMMENT

  1. \’One reason could be lenders have agreed behind-the-scenes to carry out electoral role checks within a year of issuing buy to let loans to first time borrowers to make sure they are living in the homes\’.

    Shouldn\’t that be \’not\’?

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