Landbay has introduced a suite of two-year fixed rate like-for-like remortgage products with a lower Interest Cover Ratio (ICR) stress test.
Landlords remortgaging with no change to their borrowing requirements will be stress tested at pay rate plus 1% instead of the standard calculation of pay rate plus 2%.
There are five products with variable fees and rates starting at 4.99% up to 5.99% for standard properties including mortgages for trading companies.
The loan to value (LTV) for all these products is 75% gross (i.e. including fees).
Like-for-like remortgage products – 2 year fixed – 75% LTV
- 4.99% – 4% fee (max loan size £1m)
- 5.49% – 3% fee (max loan size £1m)
- 5.99% – 2% fee (max loan size £1m)
- 5.99% – £1,499 fixed fee (max loan size £74,999)
Trading company like-for-like remortgage products – 2 year fixed – 75% LTV
- 5.69% – 3% fee (max loan size £1m)
The reduced ICR stress test also applies to Landbay’s reduced interest rate, loyalty remortgages, introduced recently for like-for-like existing Landbay borrowers.
Paul Brett (pictured), managing director, intermediaries at Landbay, said: “There is a lot of remortgage activity this year and we are acutely aware that borrowers will have to take higher rates than their current deal.
“Applying a stress test is always a requirement but we have tried to soften the blow for buy-to-let landlords whose mortgage is due for renewal.
“It is clear that two-year fixed rates are attractive to some borrowers due to the volatility of the current market. Lowering the rate on the stress test allows borrowers more breathing space when the affordability calculation is applied.”
