Average five-year fix buy-to-let rate lowest on record
Landlords looking for longer-term fixed rate mortgages can lock into exceptionally priced buy-to-let rates.
The average buy-to-let five-year fixed rate for landlords has dropped to its lowest-ever level, according to figures from Moneyfacts.co.uk.
Research from the financial information provider says the average five-year fixed buy-to-let rate is currently 3.4%, compared to 3.43% last year and 3.77% two years ago.
Aaron Strutt, product director at Trinity Financial, says: “Even though the average rate is 3.4% the lowest pay rates are much lower, particularly if you have a larger deposit and clear credit history.
“If you are looking for a longer-term buy-to-let fixed rate there are some great options available as the lenders have been consistently undercutting each other to offer the best rates.
Virgin Money is offering a 2.13% buy-to-let five-year fix and the mortgage is one of the most attractive deals across the market.
The bank's buy-to-let rate is fixed until 01 January 2024. At the end of this period, it reverts to the lender's variable rate currently of 5.19%. The overall cost for comparison is 4.43% APRC representative.
The mortgage has a £1,995 arrangement fee, and applicants will need a 40% deposit to qualify. Early repayment charges apply for the fixed period and the maximum loan is £1 million.
The bank will pay for the property valuation and standard legal fees if you are remortgaging. It is also taking an average of 13 days to produce mortgage offers.
Representative example: A mortgage of £250,000 payable over 25 years, initially on a 1.84% fixed rate until 02/01/2024 and then on a variable rate of 4% for the remaining 23 years, would require 62 monthly repayments of £1,040.27 followed by 238 monthly repayments of £1,236.13. The total amount repayable would be £367,006.68 made up of the loan amount, plus interest (£115,121.68) and fees of £1,499. The overall cost for comparison is 3.23% APRC representative.
The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration.
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