MortgagesOct 1 2015

Fleet sails in with 2-year BTL deal at 2.99%

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Fleet Mortgages has revamped its entire product range mere weeks after unveiling a standard two-year fixed rate buy-to-let mortgage priced at 2.99 per cent at up to 75 per cent LTV.

While the rate of the product remains unchanged, the fee has been discounted by 0.25 percentage point to one per cent of the loan amount.

The fix has a reversion rate of Libor plus 4.5 per cent – currently 5.1 per cent.

The lender said the decision was taken to completely overhaul its 36 products for standard, limited and HMO buy-to-let borrowers was in response to positive feedback from its intermediary partners.

Highlights of the new range include a two-year fix priced at 2.89 per cent at 65 per cent LTV with a £500 completion fee.

The fixed rate rate applicable for the two-year limited company product is 4.39 per cent up to 75 per cent LTV with £750 completion fee.

Lifetime trackers are now available at 3.99 per cent for standard buy-to-let loans at 65 per cent LTV - with the rental calculation based on pay rate and a 1 per cent completion fee.

Five-year fixed rate are available with a fixed rate of 4.09 per cent, also at 65 per cent LTV, for standard buy-to-let loans, while the product equivalent for a limited company comes at 4.79 per cent up to 75 per cent LTV with a 1.5 per cent completion fee.

Both products are also subject to rental calculation based on pay rate.

Provider view

Bob Young, chief executive officer of Fleet Mortgages, said: “It has been a very busy few months and the temptation might have been to continue with our existing product range at this stage. However, having listened closely to ongoing feedback from our intermediary partners, particularly with regard to our recent lower completion fee products and those with rental calculations based on pay rate, we felt it was important to respond positively by expanding, enhancing and adding to our range, specifically in those areas.”

Adviser view

Ying Tan, managing director of mortgage brokerage firm The Buy To Let Business said: “Sometimes in this marketplace, broker feedback is provided but not listened to or acted upon. It’s therefore very pleasing to see lenders like Fleet Mortgages genuinely looking for input and then using it to create a highly competitive product range.

“Given the changes landlords are facing with regards to the cut in higher rate tax relief on mortgage interest payments, the new limited company products are particularly interesting because we believe this is a growth part of the marketplace. On top of this fixed fee deals and pay rate rental cover calculations show this is a lender actively looking at specific landlord borrower wants and needs.”

Charges

Charges vary. A percentage-based arrangement fee and flat fee are used across the product range.

Verdict

Fleet’s decision to revamp its entire product range seems somewhat out of the blue – particularly after launching a new product within a short period of time.

Although the lender claims the move was in response to positive feedback from advisers, one cannot help but feel that the lender had a keen eye on its price hacking competition.

Landlords should do their maths properly when choosing a buy-to-let product. A product which has a high percentage base arrangement fee can substantially bump up the cost.