Mortgage Intelligence has secured a buy-to-let exclusive with 4.5% fixed rate for three years and no arrangement fee.
At the end of three years, the rate reverts to the Bank of England base rate plus 1.5% for a further two years. At the end of the fix there is a two year redemption with a discount, so it reverts to a standard base rate plus 1.50%.
Redemption charges are 5% in the first three years and then 3% and 2% respectively. This means if interest rates are low in years three to five the borrower may choose to remain on the BoE base rate plus 1.50% and avoid paying any fee.
Should the borrower choose to redeem in the last year, they will pay the redemption fee. But they won’t have been paying interest on an arrangement fee of, typically, 1.5% for four or five years.
Sally Laker, managing director at Mortgage Intelligence, says: “Unlike other cheap rate buy-to-lets, where the arrangement fee is paid upfront, or it is added to the loan at the outset, this product gives the borrower much more choice about when or if they pay a fee.
“Therefore, if interest rates remain low or drop further, borrowers could end up paying no arrangement fee at all, which could save them thousands of pounds.
“We are delighted to be able to offer this unique The Mortgage Works product to Mortgage Intelligence members on an exclusive basis.”
Paul Howard, director of intermediary sales for The Mortgage Works, says: “Other products that we have offered exclusively to Mortgage Intelligence members have proved to be very popular, we expect this exciting attractive buy-to-let product to be no exception.”
The deal is available on an unlimited number of properties to a maximum borrowing of 5m. The maximum LTV is set at 85% based on 125% of pay rate with a sliding scale of rental coverage. The lower the LTV, the less coverage required.
The product is also available to limited company, expatriates and foreign national BTL investors.