The required rental yield is now calculated using the product rate rather than the lender’s standard buy-to-let rate of 5.95 per cent (Bank base rate plus 1.95 per cent).
Nic Ekin, product manager at Pink Home Loans, comments: “This change to criteria could have a big impact on the borrowing capacity of buy-to-let investors, giving them greater opportunity to increase their portfolios”.
Guy Batchelor, sales & marketing director at Platform, comments: “We have introduced the changes to this product in response to feedback from intermediaries who are dealing with buy-to-let borrowers particularly in arrears where the ratio between rental income and amounts borrowed has narrowed. The change further enhances an already extremely competitive product and we expect demand to be high.”
The product offers an initial payment rate of 4.99%, tracking the Bank base at 0.99% for the life of the product, and is available to homeowners, first time buyers (if renting from a corporate landlord) and any landlords with student lets.
The product is available via direct submission only and offers a broker commission of 0.5% (minimum £250, max £2,500).
Product details
- Rate: 4.99% - bank base rate plus 0.99% for the term of the loan
- Minimum loan: £25,001
- Maximum loan: £500,000 up to 75% LTV
- Maximum loan to value: 85% up to £300,000
- Maximum portfolio: 10 properties up to £1 million
- Rental yield: rent must exceed 130% of the mortgage payment, calculated, on an interest only basis, at the product rate
- Arrangement fee: £395
- Broker commission: 0.5% (min £250, max £2,500)
- Early repayment charge: 4% in year 1, 3% in year 2, 2% in year 3, 1 month’s notice or 1 month’s interest thereafter
- Submission: direct to the lender
- Contact: For more information visit www.pink.uk.net
