Landbay Eases Pressure on Landlords with Stress Test Changes
Landbay, a key player in the buy-to-let mortgage sector, has recently unveiled changes to its like-for-like remortgage range, significantly easing stress testing requirements. This new approach is particularly applicable for landlords whose borrowing needs remain unchanged, offering them a more streamlined path through an evolving market.
Revised Stress Testing Criteria
Under the updated guidelines, the stress testing for these remortgage products will now be calculated at the pay rate alone, as opposed to the traditional method which added an extra 2%. This change provides much-needed relief to landlords faced with higher rates from expiring deals, as it mitigates some pressure during the affordability assessment process.
For landlords looking for suitable financial options, Landbay’s like-for-like product range includes four distinct two-year fixed-rate offerings. Rates are positioned attractively, starting at 5.24% for a loan-to-value (LTV) of 65% with a 4% fee, and extending to 5.89% at 75% LTV with a 3% fee. The maximum loan size can reach an impressive £1.5 million, making these products accessible to a broad spectrum of investors.
An overview of Landbay’s revised mortgage offerings for landlords.
Adjustments to Buy-to-Let Rates
In response to the recent decline in swap rates, Landbay has also opted to reduce product rates by 0.10% across its range. Notably, five-year fixed rates now commence at 4.74% for loans of up to 75% LTV. This strategic move places Landbay in a favorable position to attract landlords during this pivotal moment in the market.
The revamped two-year fixes offer various options, such as 5.39% at 75% LTV at a 4% fee with a maximum loan size of £1 million, and 5.74% at 65% LTV with a 3% fee, also capping at £1.5 million.
These changes undoubtedly reflect Landbay’s ongoing commitment to support landlords amidst shifting economic conditions.
Market Response and Future Expectations
Rob Stanton, Sales and Distribution Director at Landbay, elaborated on the rationale behind these adjustments, stating:
“We’re still seeing high levels of mortgage maturity in the BTL market, with many landlords making the move onto a higher rate than their current deals. While we cannot escape stress testing requirements, we can use the tools at our disposal to help alleviate some of the pressures landlords will face when the affordability calculation is applied.”
As landlords navigate these turbulent waters, it is anticipated that two-year rates will maintain popularity for those trying to predict interest rate fluctuations. The demand for manageable and adaptable lending options will likely be at the forefront of landlords’ priority lists.
Trends shaping the mortgage market for landlords.
Conclusion: Opportunities Ahead
In the face of economic uncertainty, Landbay’s decisions speak to the necessity of adaptability within the mortgage sector. By lowering stress testing requirements and adjusting rates, Landbay is paving the way for landlords to optimize their financial positions. This proactive approach is a testament to the lender’s understanding of the market dynamics and the needs of its borrowers, potentially fostering a more resilient buy-to-let landscape moving forward.
As the mortgage industry continues to evolve, the priority around affordability and sensible lending practices will remain crucial. Landbay’s latest offerings are a clear indication that it is keenly aware of the pressures that landlords face, and is prepared to support them in overcoming these challenges effectively.
