A lender claims it’s giving landlords an affordability boost by reducing its buy to let and commercial mortgage stress rates.
Stress testing has become a major hurdle for landlords in recent years, with higher interest rates limiting how much they can borrow and making deals harder to place.
Redwood says its reduction across variable, two- and three-year fixed rates aims to ease that pressure.
Tom Worbey, senior lending product manager, says: “Brokers tell us one of their biggest frustrations is stress rates. By lowering our residential BTL and commercial mortgage stress rates, we’re giving brokers more options and helping landlords achieve the leverage they need.
“Affordability is front of mind in the current market. Landlords are navigating higher costs and tighter yields, and brokers are working harder than ever to structure viable deals.”
The update applies across Redwood’s residential BTL and commercial mortgage product ranges, with affordability calculations now reflecting the reduced stress rates.
Alongside this change, the specialist business bank has introduced a new tiered pricing structure as it continues to make enhancements to its offerings.
Meanwhile the Dudley Building Society has cuts its Expat BTL five-year fixed – 70% LTV – to 5.59% (capital and interest, interest only, or part and part); and its Expat BTL five-year fixed – 80% LTV – at 5.89% (capital and interest, interest only, or part and part).
Both products have a £1,999 arrangement fee, and an early repayment charge of 4%, 3%, 2%, 1%, 1% over the five-year term. Borrowers can make overpayments of up to 10% per year without penalty.
This article is taken from Landlord Today