Paragon Bank has launched a new buy-to-let tracker mortgage range linked to the Bank of England Base Rate, aimed at giving landlords greater flexibility at a time of fluid interest rate expectations.
The new range tracks Bank Base Rate, which was reduced this week from 4.00% to 3.75%, and comes with no early repayment charges, allowing landlords to switch products at any point during the term without penalty.
The six products start at Bank Base Rate plus 1.60% and are available on a five-year term at up to 75% loan-to-value. Borrowers can choose from three fee options of 0.75%, 1.00% or 1.5%, with interest coverage ratios calculated at the initial rate plus 2%.
Three products are available for the purchase or remortgage of single self-contained properties, alongside three products aimed at houses in multiple occupation and multi-unit blocks.
Single self-contained properties do not attract an application fee, while a £299 application fee applies to HMO and MUB borrowing.
Alongside the launch, Paragon has also reduced selected two-year fixed rate buy-to-let mortgages for HMOs and MUBs by 15 basis points. Rates now start from 3.39%, with products available at 75% and 65% loan-to-value.
The 75% loan-to-value products carry a £299 application fee, while the 65% loan-to-value products are subject to a £150 fee. Nil, 3.00% and 5.00% fee options are available.
James Harrison, buy-to-let product manager at Paragon Bank, said: “With a range of fee options and no ERCs at any point throughout the five-year term, our new Bank Base Rate tracker mortgages give landlords certainty, with the flexibility to finance their investments with the products that best meet their needs.
“As we saw yesterday, Base Rate was reduced from 4.00% to 3.75% and there’s an expectation that the Bank of England will reduce it further in 2026.
This will make this product particularly competitive and a great option for landlords purchasing or remortgaging SSCs, HMOs or MUBs.”
“Louisa Sedgwick, managing director of mortgages at Paragon Bank, added: “We’re excited to bring these innovative products to market at a time when we’re in a downward Base Rate cycle.
“They offer landlords the flexibility to track Base Rate and benefit from any reduction in the rate, but also the ability to switch if they would prefer to lock in a fixed-rate later without penalty.”
