Product review: Skipton buy-to-let mortgages
As figures show that the end of the stamp duty holiday has done little to dampen the housing market, Skipton has brought a range of buy-to-let mortgages to market.
This new range includes five different products with various term lengths, fee and rate combinations, as well as loan-to values (LTV) of up to 75%.
Starting with a two-year fixed rate with up to 70% LTV through to a five-year fixed rate with up to 75% LTV, this range is like the pick ‘n’ mix of the mortgage world. Interest rates vary from 4.69% to 5.69% depending on the term and the fixed rate varies from a two- to five-year period.
Skipton head of products, Kris Brewster, said the launch of the range, timed with the spring/summer peak buying season, is a reflection of the company’s view that there is a ‘good, strong market’ where strong tenant demand is expected to continue and to increase.
Fees consist of a £245 application fee and a completion fee of either £750 or £1,250 in most cases. The decision to make fees flat rates in all but one case – the 5 year 70% LTV product has a 2% completion fee – was a conscious one to make things as simple as possible for the customer, Brewster said.
The flat fees are also designed to entice both ends of the buying spectrum, by not penalising those with higher value properties with percentage based fees.
Overpayments of up to 10% per annum with no penalty are also allowed.
Buy-to-let mortgages seem to be experiencing something of a mini-boom at the moment, with research in April showing that they accounted for almost a quarter of all business in the housing market.
Skipton re-entered the buy-to-let market only a year ago and this latest expansion to its range would suggest its most recent foray is going well, particularly with the decision to increase the maximum LTV to 75% from 70%.
Although Skipton has explored tracker rate options in the past Brewster says that this latest range, which consists only of fixed rate options, is focused on simplicity for the customer. “It is about locking in and knowing exactly where you are,” he said.