Amazing 1.99pc 2-year fixed buy-to-let at a whopping 75% loan to value!
- Published: Tuesday 07 November, 2017
- Category: BTL mortgages
- By: Andrew Pelis
- Updated: Thursday 11 January, 2018
Available on purchase or remortgage, this buy-to-let comes with no minimum income requirement, which means that (whilst you will still need to demonstrate the income you receive) you do not need to earn over a specific amount to secure this deal!
If you are a first time landlord, the lender will consider your application, but you must have owned and occupied your own home for at least 6 months, or you can apply in joint names, with someone who owns property.
Are you on a low tax band? This lender applies generous affordability calculations for those in lower tax bands of 20% or less. See below or call us for more details.
What’s more, if you are an older landlord, you may be able to take advantage of favourable terms which allow you to apply for a 35 year term up to the age of 70 years old, which means that you can borrow up to the age of 105 years old.
This lender is looking for landlords with no more than 3 rental properties (whether mortgaged or not).
1.99pc 2-year fixed buy-to-let at a 75% loan to value
|Product type||Initial rate||Max. Loan to Value||Product fee||*ERC's|
|2-year fixed||1.99%||75%||£1,995||For 2-years|
*Early Repayment Charge
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
Up to 2 people can apply and both must be UK residents. Foreign nationals will need to prove they have been a resident in the UK for at least 3 years and must have a permanent right to reside in the UK, along with a UK bank account.
The minimum applicant age is 21 years-old, the maximum age at application is 70 years-old.
Before a lender will loan you money, they need to be (and are required to be) confident you can afford the repayments.
This assessment of affordability takes into account not just a snapshot of your current financial picture, but also looks at how affordable your mortgage would be if there was a change in your circumstances (e.g. a mortgage rate change, a missed rental payment by your tenants etc).
This assessment has recently become stricter, with a large number of lenders, due to a regulation change. This has meant that some landlords have struggled to raise the funds they want.
Affordability for this deal
If you are a basic rate taxpayer (paying 20% tax), or pay no tax, then this product might be ideal!
The lender applies a lower interest cover ratio for those in the 20% or below tax bracket, when calculating affordability of your mortgage repayments.
What does this mean?
This means that, for basic rate taxpayers, the calculation is more lenient, thus allowing you to borrow more than may be possible with other lenders.
The lender will assess your ability to cover your mortgage payments based on the rental income you can achieve from your property.
For those on the basic or lower rates, your income will be assessed based on be able to cover 125% of the mortgage payment, at an assumed stress rate of 5.50%, which the lender applies to cover the eventuality of future interest rate rises.
For those on the higher tax bands (40% or more), the same stress rate of 5.50% applies, but your income will need to cover 145% of the mortgage repayments, in case of a change in your financial position.
Proof of income:
If you qualify for the 125% income coverage rating you will be required to provide proof of income and this may also apply to those on the higher affordability test (145%).
You will need to supply evidence of your gross earned income (not including any bonuses, overtime or commission); or where applicable, your pension income.
Typically this will be a tax calculation and Tax Year Overview in the form of the latest SA302, but alternatively you can provide an accountant's reference.
However, if you are a First Time Landlord with employed or retired income, you must produce your last payslip or pension statement. If you have no taxable income, then you must supply your last 3 months of bank statements.
In the case of remortgages, you must have owned the property for at least the previous 6 months.
If you are wishing to raise capital for a non-business purpose such as a deposit, the lender will consider your application. Similarly, you can apply to raise capital for non-structural home improvements.
Loan and property details
The minimum property value is £50,000.
The minimum loan size is £25,001 and the maximum loan size is £500,000.
The minimum loan term is 5 years and the maximum loan term is 35 years.
This information should not be interpreted as financial advice. Mortgage and loan rates are subject to change.