At present we are seeing an increase in lenders re-entering the buy to let market due to the ever increasing demand for rental properties and the current success the early re-entrants (such as Paragon) have had.
Kent Reliance is the latest to re-enter, offering products through their premier partners all of whom are specialist buy to let and commercial brokers. This increasing trend of specialisation makes it all the more important for landlords to only deal with a broker who operates exclusively in the buy to let and commercial arena. Some of the offers included are a 2 year discounted rate at 4.98% up to 75% LTV with a 1% arrangement fee. Options of fixed and discounted deals are also an option.
There will be no credit scoring by the lender to make decsions as cases will be manually underwritten by experienced staff at the building society. The criteria will allow lending in the following categories – first-time buyers, Ltd Company Mortgages and Buy to Let, new builds, student lets and house of multiple occupancy (HMO Mortgages).
In the past few weeks Skipton Building Society and Coventry Intermediaries have re-entered the market, Skipton has launched a range of fixed rate buy-to-let deals, a 2 year fix at 3.99% is available up to 70% LTV with a £2,495 completion fee.
Skipton have also released 2 buy-to-let trackers both having an application fee of £245 and a completion fee of £995. They are available at 60% and 70% LTV, at rates from Bank Base Rate plus 2.74% and have been opeend up to wide distribution.
A 2 year base rate tracker mortgage of up to 60% LTV at Bank Base Rate plus 2.74% currently 3.24% and a 2 year base rate tracker mortgage of up to 70% LTV at Bank Base Rate plus 3.09% currently 3.59% are include in the product range.
Skipton’s buy-to-let products are now available to first time landlords, that can demonstrate they have owned residential property for at least 6 months, also for new builds with the exception of new build flats. The minimun eligible income for main applicants has rduced to £20,000 per annum from £30,000.
Coventry however have launched a 5 year fixed rate buy-to-let deal at 5.99% up to 75% LTV with no arrangement fee or early repayment charge. There is also a 5 year fix at 5.49% available up to 75% LTV with an arrangement fee of £2,999. This significant difference in fees makes it crucial that landlords fully analyse their costings before making a decision.
Mortgage Trust returned to the buy-to-let market in April and has launched 6 new buy-to-let products which are exclusive for purchases and remortgages via intermediaries, and include tracker rates from 4.30% and fixed rates from 4.89%
Additionally they have launched 2 rapid remortgage deals, which have a 1% fee and free legals and valuation. They include a 3.99% 2 year tracker and a 4.99% 2 year fixed both at 75% LTV. These deals must be completed by 29th July 2011.
The 2 rapid remortgage products are available for single, self contained properties only. The product fee is 1.75% across the range, 1% on the rapid mortgage range and the rental calculation is based on 125% at 5% or the product rate if greater. This generious rental calculation is refreshing in the current market and combined with other recent changes (such as Skipton reducing their minimum income) reflects a return to common sense lending in the buy to let mortgage market after a significan slowdown and tightening.
The latest Residential Lettings Survey form the Royal Institution of Chartered Surveyors has shown 42% of surveyors have reported a rise in rents in the 3 months to April. It notes that rent in some areas have risen so suddenly that affordability has been significantly hit which is making things difficult for new potential tenants.
Many potential home owners are restricted from getting a foot on the ladder, leading to higher demand in an oversubscribed rental marketResidential Practitioner at RICS, James Scott-Lee