85% LTV at 110% interest cover Buy to Let – InterBay Commercial

by Neil Patterson

13:05 PM, 23rd January 2014
About 7 years ago

85% LTV at 110% interest cover Buy to Let – InterBay Commercial

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85% LTV at 110% interest cover Buy to Let – InterBay Commercial

InterBay Commercial part of OneSavings Bank plc group have introduced a new Buy to Let range and of real interest for the market is an 85% Loan to Value product stress tested at 110% interest cover on the pay rate.

This means that the amount you can borrow  is worked out by the monthly rental income needing to be 110% of the monthly interest only payment subject to the 85% maximum LTV.

E.g. max loan = monthly rental income x 12, divided by pay rate %, divided by 110%

Therefore in this example: max loan = rent x12, divided by 6.1%, divided by 110%

or as an easy calculation max loan = monthly rent x 178.83 (this is very competitive considering the high 85% LTV)

The product:

  • 6.1% Libor Tracker = 3 month Libor (min rate 0.75%) plus 5.35% for the term
  • Maximum 85% LTV
  • 2% arrangement fee (additional 1% fee if loan below £75,000)
  • HMOs and New build flats maximum 75% LTV
  • Interest Only available up to a maximum 10 year term, but available for longer with a 0.5% rate loading
  • Early repayment charge 3% for first 5 years and 1% for the life of the loan
  • Minimum 2 years BTL experience (no First time landlords)
  • Available to individuals, limited companies, LLPs and Partnerships
  • Max loan size £1million

This now gives an alternative for Buy to Let investors at 85% LTV if your circumstances do not fit criteria for Kent Reliance who offer a similar product at 4.89% two year discount, with a 2.5% fee and you can borrow 192 times monthly rental income. However the reversion rate after 2 years is currently 6.58% so may not be as good value over a longer term if rates stay low.

I have been told that Interbay use a more flexible commercial approach to Buy to Let lending which could be an advantage in more complicated situations.

InterBay Commercial will only deal with authorised introducers and not the general public.

For assistance with this or any property finance requirements please, call us on 01603 489118 or email info@property118.com

If you would like to add your own requirements and search for the most popular available Buy to Let products please click here interbay commercial


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Comments

Simone Gilks (Mortgage Adviser)

14:15 PM, 23rd January 2014
About 7 years ago

This has already proven to be a huge success within my office, with clients enjoying only having to put down 15% deposit. This ensures that are able to spread their cash across a variety of properties as opposed to just one, spread the risk we say.

Now with a cover rate of just 110% this also means that whereby some properties rental income may not have afforded the usual lenders criteria, here they have more of a chance.

By this I mean we normally use a rate of 5% with 125% cover, which doesn't always mean that the figures stack up when purchasing a Buy To Let on a 15% deposit.

Of course this is an excellent product and may well be suited to most of you, but please do speak with a qualified and whole of market BTL specialist such as my good self as its important to have all of the facts and comparisons before making that final decision.

Please do check out my profile

Everyday is a learning day!

Jamie M

15:06 PM, 23rd January 2014
About 7 years ago

Fancy recommending a product you are selling, mmmmm original 🙁 ? It must be good……..

DC

15:10 PM, 23rd January 2014
About 7 years ago

I've had a quick look on their website but there is no mention of this product yet. What I really wanted to look at was their full BTL lending criteria if anyone can help please?

Neil Patterson

15:15 PM, 23rd January 2014
About 7 years ago

Reply to the comment left by "DC " at "23/01/2014 - 15:10":

Hi DC,

I am afraid as I mentioned they do not deal with the general public, but I am sure Simone will be able to help if you click on her member profile as they only deal direct with introducers.

I have seen the product details which I have posted above but full criteria and agreement process will be more complex.

Neil Patterson

15:21 PM, 23rd January 2014
About 7 years ago

Reply to the comment left by "Jamie Moodie" at "23/01/2014 - 15:06":

Hi Jamie,

This product in particular is news because of its 85% LTV and there is only one other lender in the BTL market that offers the same LTV. So it is worth making a comparison.

We can gain access to any products in the market with the help of our partner companies so I hope your mind is put at rest that I never have an interest in selling a particular lender or product.

As ever there is no right or wrong option as every one is individual and different products will suit or fit different people.

Simone Gilks (Mortgage Adviser)

15:53 PM, 23rd January 2014
About 7 years ago

HI DC

Please do contact me if you wish to understand the criteria as I have it on my PC and of course what we don't know we can always ask -

Jamie - Of course, we sell most financial products so it would be hard not to talk about them.

many thanks

Anthony Endsor

20:48 PM, 23rd January 2014
About 7 years ago

Hello
Is there any minimum income requirement for this product? I know a lot of companies are happy to lend for BTL, but require a minimum income along with their criteria. My income usually falls below a lot of lenders' requirements when they do this. If not, I would be very interested in discussing this with one of you. I have a BTL property I want to remortgage as I got it cheap about 3 years ago and now want to drawdown on the extra value so I can buy another property, again hopefully using this product if it suits.

Jeremy Smith

1:33 AM, 24th January 2014
About 7 years ago

Reply to the comment left by "Anthony Endsor" at "23/01/2014 - 20:48":

On just a handful of properties, I have over 500k equity and loads of cash/equiv. and because of my low income for 2010/11 and 2011/12, ie less than 24k per year on my tax return, since I have carried forward losses from previous years, I have just been advised not to apply for a mortgage by a lender on the list of suggested lenders from the property118.com lenders.
I am grateful that they have a "pre-application" chat, since I don't won't a refusal on my credit check, but I have far more equity and cash than I have outstanding/borrowed, but not quite enough cash to buy outright.....

.....so I'll just have to keep saving, but by that time the prices will have moved up another notch !!!

Neil Patterson

10:04 AM, 24th January 2014
About 7 years ago

Reply to the comment left by "Jeremy Smith" at "24/01/2014 - 01:33":

Hi Jeremy,

That is only one lender so why would that put you off when there are many more with different income criteria?

A Broker will only send you to a lender for an agreement in principle if you fit the criteria in the first place.

Simone Gilks (Mortgage Adviser)

11:25 AM, 24th January 2014
About 7 years ago

Having read through the posts, I feel the biggest concern is the lack of advice! Surely if you are concerned by any of the points raised but SERIOUS about Investing in properties, then you should be working with an Independent Mortgage Broker, one who specialises in this field. You probably have an Accountant who gives you tax advice - so why not a broker who can advise on the various products available to you personally. We are not in the habit of selling or advising on products that do not meet your needs or that you wouldn't be able to apply for.

There are at present several lenders who offer 85% LTV on BTL both of which have quite different underwriting but unless you speak with a broker you wouldn't know that I guess - plus having 85% may not even fit as you would need to be receiving very high rents or have a low Loan To Value to make this work.

For all of you who thinks going it alone is the answer, well I disagree! I am passionate about what I do and I treat every clients case as if it was my own - I think about the bigger picture, so should you.

If you just want figures with a few facts thrown in for good measure, then the internet can do that but if you want true ethical advice from a real person who cares what happens now and in the future, then speak with a broker!

Every Day is a Learning Day!

regards
Simone

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