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Lender says...

NatWest has launched a new fixed rate buy-to-let mortgage and lowered the rates on two of its existing buy-to-let mortgages.

The new mortgage has a fixed rate of 6.74 per cent until 30 June 2010. It comes with an arrangement fee of £1499 and is available up to 75 per cent loan-to-value. There are early repayment charges of 2 per cent in the first year and 1 per cent in the second year with no tie-in.

The lender has also cut the interest rate on its existing two-year fixed rate product from 7.09 per cent to 6.99 per cent and has reduced the arrangement fee from £2499 to £1499.

The existing two-year tracker product has been cut from 7.09 per cent to 6.99 per cent while the arrangement fee has been reduced from £2999 to £1999. Both products have a maximum loan-to-value of 85 per cent. The rental calculation for all three products is 125 per cent at base rate plus 1.75 per cent.

Graham Felstead, head of corporate accounts for RBS Intermediary Partners, said: "While the market is still challenging, the buy-to-let sector is still offering encouraging opportunities.

"Our business volumes are now at much more manageable levels allowing us to ease the rates on existing products and introduce a competitively priced new one."

Adviser says...

Graham Thomson, managing director of Glasgow-based IFA Riverpark Investment & Financial Consultants, said: "While the rates are still high in comparison to last year, it is good to see a lender reducing rates and fees.

"The new fixed rate is competitive and the fee is also acceptable. The rental calculation is also okay with the only down side being the maximum 75 per cent loan-to-value."

Rating 4/5 stars