LendInvest unveils ‘3-year bridge’
LendInvest has launched a product for property investors it defined as a ‘3-year bridge’.
The loan costs 6.99% to 70% loan-to-value but has a pay rate of 4.99% with 2% of the interest being deferred.
The product is intended as a hybrid between bridging and buy-to-let for those who are willing to pay more to raise capital or who want to acquire a low yielding property.
It has an income coverage ratio of 110% rather than complying with the Prudential Regulation Authority’s buy-to-let stress tests and is designed for experienced borrowers.
Matthew Tooth (pictured), chief commercial officer at LendInvest, said: “The product is called a bridge because it’s more expensive than mainstream buy-to-let but investors can use it to raise money.
“It’s also not as restrictive in terms of PRA criteria.”
The product comes with a 3% early repayment charge in the first year, 2% in the second year and 1% in the third, while there is no charge in the last three months of the loan.
The maximum LTV can rise to 75% as the interest is rolleded up.