Paragon launches BTL remortgage range

Paragon's research has revealed that the proportion of BTL remortgage business is expected to grow during 2021.

Paragon launches BTL remortgage range

Paragon Bank has enhanced its portfolio product range with the launch of two remortgage-only buy-to-let (BTL) products.

 

Both products come with £500 cashback and a free mortgage valuation, and are available to landlords remortgaging in their personal names or through a limited company.

The first is suited to portfolio landlords looking to remortgage at up to 75% loan-to-value (LTV) on single self-contained properties; it has a rate of 3.45% is fixed for five years, with an APRC of 4.20% and a product fee of 1.50%.

The second, also offered at 75% LTV, is available on HMOs and multi-unit blocks (MUBs) at a rate of 3.65% fixed for five years; the product fee is set at 2.00% and the APRC is 4.30%.

Early redemption charges (ERC) of 5% are in place during years one and two, charged at 4% for years three and four and 3% for year five.

Paragon's research has revealed that the proportion of BTL remortgage business is expected to grow during 2021, as buy-to-let mortgage brokers will switch their attention to the remortgage of 5-year after the stamp duty holiday ends.

Half (50%) of brokers that deal in buy-to-let said that they will focus on 5-year remortgage business at that time.

The number of 5-year fixed-rate BTL mortgages increased significantly in the run-up to the introduction of the buy-to-let stamp duty surcharge in April 2016.

Industry data shows that the number of 5-year fixed BTLs completed in the six months to the end of March 2016 was 121% higher than the same period in 2015.

Moray Hulme, director for mortgage sales at Paragon, said: “The introduction of a 3% buy-to-let stamp duty surcharge in April 2016 lead to a marked increase in landlords choosing 5-year fixed rate mortgages.

“Research we have carried out confirmed our expectation that a significant number of brokers will be looking to support landlords who are in the process of remortgaging now that those 5-year mortgages are reaching maturity.

"The launch of our two remortgage products is a timely and useful addition to our range for brokers who are targeting this business.”