The Buy to Let Foundation, a specialist lending firm, has just rolled out an innovative group of remortgage products designed specifically for buy-to-let landlords. This new “pound for pound” option is tailored for those who wish to remortgage their properties without increasing their borrowing amount.
These remortgage products come with a fixed two-year rate, appealing to landlords who are looking to stabilise their financial planning over the short term. Tom Jacob, the Director of Product and Marketing at Foundation Home Loans, emphasises that this move is aimed at assisting landlords in managing and maintaining their current property portfolios more effectively. By not requiring additional borrowing, these products could simplify financial management for property owners.
Credit Considerations and Product Ranges
The new products are divided into two ranges:
- F1 Range: Suitable for clients with a nearly impeccable credit history.
- F2 Range: Designed for clients who have experienced credit issues in the past.
This segmentation ensures that landlords with varied financial histories have access to remortgaging options.
Advantages of “Pound for Pound” Remortgaging
The central feature of these “pound for pound” products is that they allow landlords to remortgage on the same financial terms as their existing loans. This method offers more favorable terms by standardising the evaluation of rental income to a 125% Interest Coverage Ratio (ICR), irrespective of the landlord’s tax status. Moreover, the stress tests applied are based on the pay rate of the product rather than more stringent measures.
Specifics of the Offer
- Interest Rates: The F1 range is available at an interest rate of 6.59%, and the F2 range at 6.74%.
- Loan-to-Value (LTV): Both options offer loans up to 75% of the property’s value.
- Loan Amounts: Loans start at a minimum of £50,000 and can go up to £1.5 million.
These features make the new products a potentially attractive choice for both individual landlords and those operating through limited companies.
Efficient Processing Promised
Foundation Home Loans claims to maintain robust service levels with average turnaround times of just one day for initial reviews and underwriting processes. This efficiency is part of the lender’s commitment to supporting landlords and their financial advisers in navigating the remortgage process smoothly.
Call to Action for Advisers
Tom Jacob encourages advisers to reach out to Foundation Home Loans to explore how these new remortgage options, along with their other core and specialised buy-to-let products, can benefit landlords. This proactive approach seeks to foster better understanding and utilisation of available financial tools within the real estate investment community.