Landbay launches new five-year fixed rate BTL mortgages

Buy-to-let mortgage lender Landbay has launched a new set of ‘special edition’ five-year fixed rate mortgage products, with rates starting at 4.99 per cent.

The new range aims to provide price certainty with flexibility as there are only three years of early repayment charges (ERC).

This means the borrower can redeem the mortgage in years four and five if they wish with no penalty.

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Landbay, which pulled out of the peer-to-peer lending market in 2019, said the mortgages are also beneficial for stress testing purposes, as the interest cover ratio (ICR) on five-year fixes is calculated at payrate.

The new five-year special edition range comes with a 75 per cent loan-to-value and a variable interest rate and fee structure, starting at a fee of 5 per cent for the 4.99 per cent interest rate, and gradually lowering to 2 per cent for the 5.59 per cent rate.

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“This new range provides more choice for landlords and is ideal if they are not sure whether to opt for a shorter-term or a longer-term fixed rate, together with the beneficial ICR calculation for five-year loans,” said Landbay business development director Rob Stanton.

“There are differing opinions as to what will happen with interest rates in the near to medium term. Offering five-year fixed rate loans, with three-year early repayment charges, to our landlord borrowers provides additional flexibility and reassurance in an uncertain market.”

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