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Buy To Let Is Back!

03.02.11

To coin a phrase, rumours of the death of the Buy-To-Let market have been grossly exaggerated! As regular readers will be aware, we have stated that 2011 will be a year when more lenders re-enter the Buy-To-Let market as First Time Buyers continue to struggle to get on the housing ladder, rents harden and landlords look to take advantage of a ponderous housing market before the economy really starts to recover fully.

As predicted, the first major release of the year in this sector already looks like a beauty, coming from the company that were synonymous with professional landlords before the credit crunch, Paragon.

Paragon has launched three two-year tracker products, with rates starting from 3.30%, and a three-year tracker mortgage at 3.60%. In addition, the buy-to-let mortgage specialist has introduced three two-year fixed rate mortgage products with rates starting from 4.25%.

Loan-to-values, (LTV’s) across the new products range from 60% to 75% and all products have a 2% fee, which is importantly CAPPED at a maximum of £2,000 where many other lenders have high percentage fees.

Together with a realistic rental calculation based on 125% at a nominal interest rate of 5%, this is especially useful for large mortgage loans up to £1,000,000 on High Net Worth properties.

The products are available for single, self-contained properties and applicants are required to have a minimum income of £40,000 per annum. Applications must be received by 31 March 2011 and the mortgages have to be completed by 31 May 2011.

With other lenders looking to re-enter the buy-to-let market over the coming months this is a good start to what will be an interesting year for those looking to invest in property.