Buy-to-let  

Limited edition BTL from Mortgage Trust

Limited edition BTL from Mortgage Trust

Mortgage Trust has released a limited edition buy-to-let five-year fixed rate product at a rate of 3.45 per cent. 

It will be levelled at up to 75 per cent loan-to-value and include a free mortgage valuation and a nil product fee.

The offer will be limited to “individual landlords seeking finance for self-contained units” and will offer landlords up to £500,000 at 75 per cent LTV and up to £1m at 70 per cent LTV. It features an interest coverage ratio starting at 125 per cent at 4 per cent. 

At the end of last month Mortgage Trust launched three new limited edition buy-to-let products at the lowest rates that had been offered by the provider.

The two-year fixed rates are available at 1.95 per cent and 2.05 per cent for buy-to-let property purchases and remortgages. The range includes a two-year fix at 1.95 per cent for borrowing up to 75 per cent LTV. Product fees start from £495 and each product includes a free valuation.

Charges

Fees start at £495.

Reactions

Provider view 

John Heron, director of mortgages at Mortgage Trust, said: “Longer term fixed rates are becoming increasingly popular, providing landlords with greater cost certainty as they look to manage the introduction of new tax changes. 

“With interest rates still close to historic lows, now is a good time for landlords to consider the potential advantages of locking in for a longer period.”

Adviser view

Danny Matthews, adviser at Newport-based Total Mortgage Network, said: “It does seem like a decent enough product, but in the buy-to-let market especially, I don’t think anyone is doing anything out of the ordinary, I think its very normal competition-based increases and decreases. It would be nice to see something dynamic in buy-to-let, as I think it’s all got a bit stale in the past few months with the politics of it all. 

“It’s been a while since I’ve seen something really great, or anything substantial to make even us as brokers think that that’s something to speak to our clients about. It’s all been a little bit too much based around competition between lenders and it’s been tiny, tiny little movements. It would be nice to see something a little bit more exciting in the buy-to-let market.” 

Verdict 

Simply put – and this is a general point for mortgage lenders, not just Mortgage Trust – the buy-to-let lending market is in limbo as Chancellor Philip Hammond continues to throw buckets of cold water over what was arguably a buy-to-let inferno of middle class investors. In this kind of environment , it should not be seen as unusual that lenders are not trying to pour petrol over a dampened fire, by releasing dynamic buy-to-let products.

“Limited edition” may reflect limited take up in this case as the buy-to-let market is much more than “self-contained units”. The normality of the product in this case represents a contraction of a bigger market with the potential of a glut of former buy-to-let properties putting up the for sale signs as the market becomes less profitable. Time to dust off first-time buyer policies sitting in the drawer.