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Sunday, September 13, 2009

Resident buy-to-let broker news

Good day everyone – welcome to another week of news and views of the buy to let market.

News & views

We need a new bank!

Many people within the industry are seeing increasing levels of new buy to let enquiries – we certainly have. The major issue, however, is still the lack of lenders and products in this marketplace. As predicted the merger of Lloyds and HBoS, while necessary, has not done anything to increase competition and so spur on the development of better rates and products.

Landlord insurance - specialist advice - at supermarket prices

So what we need is a new entrant or two to the market. The slightly leftfield emergence of Bank of China was a good sign, however their lending criteria knocked out so many potential clients, they will probably only do about 10 mortgages a month. Once one new bank enters (or re-enters, Bank of Ireland - if you’re listening) the market it will lay the groundwork, and soften the barrier to entry for many others. Like a group of mumbling boys, staring at their shoes at a sixth form dance, someone needs to make the first move.

Take Advantage while you can.

The mortgage lender, Advantage Home Loans, are still offering significant discounts on your current mortgage balance if you move away from them.

Many of these deals expire in October, so there is still a chance to benefit from the discount. We have many examples of where we have had to help negotiate the loan reduction even further in order to be able to remortgage away to another lender. The record loan amount that we have been able to have written off is still £91,000!


Buy to Let Product Update


1. BM Solutions
Interest rate: 4.35%
LTV: 75%
Product Detail: 1 year tracker
Arrangement Fee: 3%
Early Redemption Penalties: 3% in first year.
Our thoughts: The lowest rental cover for 75% loan to value mortgages but watch the reversionary rate after the first year



2. BM Solutions
Interest rate: 5.4%
LTV: 75%
Product Detail: 2 year fixed
Arrangement Fee: 2.5%
Early Redemption Penalties: 3% in first 2 years.
Our thoughts: The lowest 2 year fixed rate at 75%.


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