Some buy-to-let mortgage rates match or undercut the price of residential rates
Residental mortgage rates have been rising so much that they are now regularly either the same price as buy-to-let mortgages or, in some cases, even cheaper.
Virgin Money for Intermediaries lowest buy-to-let let rate is 0.34% cheaper than its equivalent residential rate. Even though the arrangement fee is £1,000 more, it is still unusual for the buy-to-let rate to be so much cheaper.
HSBC buy-to-let rate is also 0.25% cheaper than its equivalent residential rate, and Barclays buy-to-let mortgages are nearly the same as its residential rates for those with a 40% deposit.
Aaron Strutt, product director at Trinity Financial, says: "While many lenders have been raising the price of their most competitively priced fixed rates, lenders have not been raising their buy-to-let rates by the same margins. If you plan to purchase a buy-to-let property or refinance to switch to a better deal, there are some great options."
Furness offering 1.59% discounted buy-to-let mortgage rates
Furness Building Society offers one of the lowest buy-to-let mortgage rates, priced at 1.59%, and it is available for property purchases and remortgages.
It is a two-year discounted rate with a 4.05% discount from the lender's 5.64% variable rate. Applicants will need a 40% deposit to qualify, and the maximum loan is £750,000. Early repayment charges apply.
Representative Example: A mortgage of £200,000 payable over 25 years initially on a discount rate for 2 years at 1.59% and then on our BTL Mortgage Variable Rate (MVR) of 5.64% (variable) for the remaining 23 years would require 24 monthly payments of £266.34 and 276 monthly payments of £944.77. The total amount payable would be £468,338.94 made up of the loan amount plus interest (£466,898.94) an application fee of £995, a valuation fee of £355 a CHAPS Fee of £20.00 and a Mortgage Discharge Fee of £120. The overall cost for comparison is 5.3% APRC representative.
Most Buy-to-Let mortgages are not regulated by the Financial Conduct Authority
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