Plan beyond Brexit with a 10-year fixed buy-to-let
Take the long-term pain out of payment planning with this 10-year fixed buy-to-let mortgage at the competitive rate of 2.95%.
With uncertainty over the impact of Brexit, the stepped reduction in mortgage interest relief and speculation over prospective interest rates changes, this product offers a sense of stability through to 2027.
There is no application fee, the mortgage affordability calculation is very favourable and the lender will accept some credit issues, so lots to consider that may be of help to you (more details below).
Lastly, the Early Repayment Charge (ERC) for this mortgage gives you flexibility in the last five years of the deal period, as it drops to just 1%. Which means that, if you did want to make a change early, the costs to do so reduce dramatically.
2.95% fixed rate 10-year buy-to-let for purchase or remortgage
|Product type||Initial rate||Max. Loan to Value||Product fee||ERC's|
|10-year fixed||2.95%||65%||£1999||For 10-years|
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
Large drop in ERC from year 6
Clients may repay up to 10% of the outstanding capital each year, without incurring an early repayment charge.
Thereafter, the following Early Repayment Charges apply:
- 5.00% of the balance repaid until 31/10/19 (years 1 and 2)
- 3.00% of the balance repaid until 31/10/22 (years 3, 4 and 5)
- 1.00% of the balance repaid until 31/10/27 (years 6, 7, 8, 9 and 10)
Excellent mortgage affordability terms for basic rate tax payers
Non-taxpayers and basic rate taxpayers: This lender requires the rent you charge to cover the monthly mortgage repayment amount, plus an additional 25% (125% of the repayment).
To further protect your ability to repay in the event of a rate change, the lender uses a hypothetical mortgage rate of 5.0% with the 125% to calculate an inflated mortgage repayment amount, rather than the actual amount you will repay.
By doing so, they assess your ability to repay at the inflated amount, thus mitigating the risk that you would struggle if your mortgage became more expensive.
Whilst 125% may seem like a lot, many lenders look for 145%, which means that elsewhere you may fail to secure the borrowing you want.
Higher or additional rate taxpayers: Must demonstrate that their rental income can cover a sum based on a calculation of 140% of the monthly mortgage amount and a rate of 5.0%.
There are no minimum income requirements.
Employed: the latest P60 and last month’s payslip will need to be produced as evidence of employment and income. Where the applicant is employed by a family business or a family member, the lender will need to see two months' bank statements and possibly further information.
Contractors: need to show their latest contract.
Self-employed, Sole Trader, Partnerships: (including Limited Liability Partnerships) and Sub-contractors are required to produce the latest year's HMRC Tax Year Calculation plus the Tax Overview documentation.
Pension income: you will need at least one of the following; your two most recent bank statements showing the pension payments, your latest annual pension statement, or a pension slip dated with the last 12 months.
Rental income: Buy-to-let portfolio document (speak to your advisor for details) or, your latest HMRC Tax Calculation and Tax Year Overview.
Company directors: Please check with your advisor for details on the criteria relating to ownership of more or less than 20% of a company, or for those with pension income, or receiving rental income.
The lender will give consideration to applicants with previous CCJs, defaults or arrears but not repossessions. Defaults must be less than £1500, with further stipulations according to type of default, speak to your advisor.
Applicant age: All applicants must be aged 18 or over and no more than 75 years old at the date of application.
Number of applicants: Up to four applicants can apply in joint names, but first-time buyers are not eligible for this product.
The property must have been owned by the applicant(s) for at least six months, prior to the application date, unless it has been inherited.
This information should not be interpreted as financial advice. Mortgage and loan rates are subject to change.