Paragon and Molo cut BTL mortgage rates – round-up
Buy-to-let (BTL) lenders Paragon Bank and Molo have cut fixed and tracker rates across their ranges of products.
Following cuts to Paragon’s two-year BTL fixes, deals for landlords now start at 3.89%.
EPC-linked deals
The 3.89% rate is for single self-contained properties with an A to C Energy Performance Certificate (EPC) rating. The rate increases to 3.94% for homes with an EPC D or E rating.
Available at 70% loan to value (LTV), the deals come with a 5% fee.
At 75% LTV, Paragon is offering two-year fixed rate deals starting from 4.8% and a 3% product fee.
Landlords who want to pay a lower fee can opt for a 1.5% alternative, with rates starting from 5.55% for an EPC A to C property and 5.6% for EPC D and E.
HMOs and MUBs
Landlords financing the purchase or remortgage of houses in multiple occupation (HMOs) or multi-unit blocks (MUBs) are offered the same suite of products, with rates starting at 4.14% at 70% LTV and 5.05% at 75% LTV.
Interest coverage ratios (ICRs) are calculated at the initial rate plus two percentage points. Meanwhile, products are available for individual and limited company applications in England, Scotland and Wales. They include a free mortgage valuation and incur a £299 application fee.
Louisa Sedgwick (pictured), mortgages commercial director at Paragon Bank, said: “Since the start of the year, we’ve seen a steady increase in the proportion of landlords looking for two-year fixed-rate products and we have responded by launching these competitive rates, with a range of LTVs and fees, providing landlords with plenty of choice.”
The rate cuts follow the release of Paragon’s latest trading update. The lender said its cumulative BTL advances are estimated to be around £1.1bn in the year to date. This is slightly down from £1.4bn of BTL advances in the same period last year.
The firm said that new business levels for BTL were “running ahead of expectations” and application levels were “strong”.
Molo applies cuts up to 25bps
Molo has cut rates for individual and limited company landlords, which also applies to specialist products such as HMOs, MUBs and holiday lets.
Rate reductions of up to 25 basis points have been applied to selected deals.
UK resident fixed rates now start from 4.35% on two-year fixed rates and 4.96% on five-year fixed rates.
For non-UK residents, tracker rates have been increased, with two-year trackers starting from 8.65% and five-year trackers from 8.84%, both at a 70% LTV.
Specialist product rates now start from 4.45% for a two-year fixed rate, applicable on MUBs, HMO, holiday lets, and investor-led properties.
Expat fixed rates now start from 4.99% for capital and interest mortgages and 5.74% for interest-only mortgages.
The next meeting of the Monetary Policy Committee (MPC) to decide on the direction of the Bank of England base rate will be held on 1 August.
Samantha Partington is a freelance trade and consumer journalist writing about property and personal finance. Previously she worked worked for the Daily Mail and Property Week. She is the former deputy editor of Mortgage Solutions and editor of Specialist Lending Solutions.
Before becoming a journalist, Samantha worked as a mortgage broker and latterly for a mortgage, bridging and secured loan lender. Samantha is CeMAP qualified. Follow her on Twitter @SamJPartington1.
