A new buy-to-let mortgage has been launched by Hinckley & Rugby Building Society. It is available exclusively through brokers.
The 60% LTV rate of 2.69% is the lowest on the sourcing system but the deal comes with a hefty fee and rental cover requirement is higher than normal at 135%.
The arrangement fee is £2,249 and booking fee £250. Valuation is free for properties up to £1m, and there are no early repayment charges.
Ying Tan, managing director of the Buy to Let Business Mortgage Club, which is offering the deal, said: “This incredibly low rate is ground-breaking for the buy-to-let sector. In all my years I have never seen such a low rate for buy-to-let, and given a flat fee, free valuation and no early repayment charges, it has blown me away.
“For a property worth £250,000 at 60% the loan size is £150,000. The monthly mortgage payments for an interest only mortgage will be as low as £336, and the rent required to get the full level of funding would be £454. Most properties at this value would rent out for in excess of £1,000.
“This product will give landlords remarkable cash flow, at a time when cash is king.”
Carolyn Thornley-Yates, business development manager at Hinckley & Rugby Building Society, said: “Following a very strong start to the year, we are looking to further increase application levels by offering this market-leading exclusive product to the Buy to Let Business.
“We are sure that landlords with at least 40% equity in the property will appreciate the very low charging rate, flat fee structure and free valuation.”