Zephyr Homeloans, a specialist in buy-to-let mortgages, has slashed its interest rates, making it cheaper for landlords to borrow money for investment properties.

Zephyr is reducing its mortgage rates by 15 basis points (bps) across both its five-year fixed rate and lifetime tracker mortgage offerings. This adjustment means lower costs for landlords looking to finance their rental properties, whether they’re acquiring new assets or refinancing existing ones.

Better Rates for Greener Homes

The lender is particularly rewarding landlords of environmentally friendlier properties. If you own a property with an A to C-rated energy performance certificate (EPC), you’re in luck. Here’s what Zephyr now offers for such properties:

• A five-year fixed rate mortgage is now just 5.15% interest, available for loans up to 65% of the property’s value (known as 65% Loan-to-Value or LTV). However, this comes with a 5% product fee.
• For those who prefer flexibility, Zephyr’s lifetime tracker mortgage at 65% LTV now sits at an interest rate of 6.79%, with a 3% fee.

Properties rated D or E on the EPC scale aren’t left out, albeit with slightly higher rates:

• The five-year fixed rate for these properties is now 5.25%, also at 65% LTV, with a 5% fee.
• The lifetime tracker starts at 6.89% with a 3% fee.

A Wide Range of Eligible Properties

Zephyr’s updated mortgage products cover a broad spectrum of property types. This includes standard residential properties, Houses in Multiple Occupation (HMOs), Multi-unit Freehold Blocks (MUFBs), newly constructed properties, and even flats situated above commercial premises. This wide eligibility aims to cater to various landlord portfolios and investment strategies.

Flexible Fee Options

In a further boost to affordability and flexibility, Zephyr now allows product fees to be added to the mortgage for all products, including those with up to 75% LTV. This option can help landlords manage upfront costs, making it easier to secure financing without a significant immediate financial outlay.

Continuing the Trend of Rate Cuts

This announcement follows a series of rate cuts by Zephyr Homeloans, including reductions of up to 0.65% across its two and five-year fixed rate mortgages earlier in January. It signals a continued effort to support buy-to-let landlords with more competitive and accessible financing options.

A Sign of Market Recovery?

Paul Fryers, Managing Director at Zephyr Homeloans, expressed optimism about the housing market’s outlook, stating, “It’s great to be able to offer reductions to brokers for their buy-to-let landlord customers, as we hopefully start to see some green shoots of recovery for the market in 2024.”