Two companies in the buy-to-let (BTL) mortgage market, Fleet Mortgages and Keystone Property Finance, have announced significant reductions in their interest rates.
Fleet Mortgages has reduced the interest rates on its range of mortgage products. These cuts cover two-year, five-year, and seven-year fixed-term mortgages across three main categories: standard, limited company, and HMO (Houses in Multiple Occupation)/multi-unit block portfolios.
For standard and limited company mortgages, the new two-year fixed rate now starts at 5.04%, down from 5.24%. If you’re looking for something longer-term, the five-year fixed rates have been adjusted to 4.74% for loans covering up to 70% of the property’s value (loan-to-value or LTV) and 5.14% for up to 75% LTV, down from 5.14% and 5.54% respectively.
A Boost for Eco-Friendly Properties
In an effort to promote environmentally friendly housing, Fleet Mortgages is offering lower rates for properties with an A-C Energy Performance Certificate (EPC) rating. These green properties can now secure a five-year fixed rate at 5.04% and a seven-year fixed rate at 4.94%, both for up to 75% LTV.
HMO and Multi-Unit Blocks Also Benefit
Investors in HMOs and multi-unit blocks aren’t left out. Their two-year fixed rates have been reduced to 5.44% (previously 5.64%), and the five-year fixed rates are now at 5.14% for up to 70% LTV and 5.48% for up to 75% LTV.
For all 75% LTV products, there’s a fee of 3%, while the five-year 70% LTV products have a higher fee of 5%. The minimum fee set for each product is £750. After the term ends, these rates revert to the Bank Base Rate plus 3%.
Keystone Property Finance Follows Suit
Keystone Property Finance is also making headlines with its own set of rate reductions. The new standard fixed-rate mortgages now start at an impressive 4.14%.
Expat Mortgages See Biggest Drop
Expatriate landlords, in particular, are in for a treat as the rates for expat mortgages have been slashed by up to 0.65%, bringing the starting rate down to a competitive 5.49%.
Rates for Keystone’s standard and specialist products, designed for HMOs and multi-unit freehold blocks (MUFBs) that accommodate up to 15 occupants or units, have seen reductions of up to 0.55%.
Keystone has removed the 5.5% and 7% arrangement fee options on its five-year fixed rates and introduced a new 3% arrangement fee option to its product transfer range, with rates starting at 4.89%.
What Does This Mean for Landlords and Investors?
The moves by Fleet Mortgages and Keystone Property Finance signal a more competitive and dynamic market for BTL mortgages. Lower interest rates mean lower monthly payments, making it more affordable for landlords to finance their properties. This could be particularly beneficial for those looking to invest in eco-friendly properties or manage HMOs and multi-unit blocks.
For existing landlords and investors, these rate cuts could present an opportunity to refinance existing mortgages to more favorable terms. However, it’s important to consider any applicable fees and the long-term impact of these changes on your investment strategy.