Bluestone Mortgages has today introduced an interest-only buy-to-let option.
The lender says it is targetting customers who want lower monthly costs.
The new loans will be available for customers on Bluestone’s ‘Clear’ or ‘AAA’ products with a maximum LTV of 80 per cent.
Top slicing with income will be available on all interest-only buy-to-lets, with a minimum rental income of 112 per cent interest coverage ratio.
The ICR for basic rate taxpayers is 125 per cent, and 140 per cent for higher rate taxpayers.
All products can be underwritten using income and expenditure where the ICR minimum is not achieved.
The interest only product will also be made available to first-time buyers & first-time landlords. However, these groups will need a full income and expenditure calculation completed on a capital and interest basis.
Bluestone Mortgages director of sales and marketing Steve Seal says: “As a specialist lender, we are committed to providing suitable finance solutions to those who are currently underserved, or who have been excluded by mainstream lenders.”