Landbay’s Special Edition range has rates reduced

Landbay’s Special Edition range has rates reduced

10:56 AM, 23rd January 2023, About A year ago 4

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Landbay has revealed that it has made further reductions of up to 30 basis points on its five-year fixed rate Special Edition buy-to-let mortgage range.

Rates start at 4.29% and the reductions apply to standard properties with LTVs of 55%, 65% and 75%.

There is a variable fee structure of between 2% and 7% to help with affordability and passing interest coverage ratio (ICR) requirements.

Product examples on standard five-year fixed rates

  • 75% LTV @ 5.39% – 2% fee
  • 75% LTV @ 4.79% – 5% fee
  • 65% LTV @ 5.34% – 2% fee
  • 65% LTV @ 4.34% – 5% fee
  • 55% LTV @ 5.29% – 2% fee
  • 55% LTV @ 4.29% – 7% fee

‘Another reduction in our five-year fixed rate Special Edition range’

Rob Stanton, business development director at Landbay, said: “We are pleased to be able to announce another reduction in our five-year fixed rate Special Edition range on standard properties.

“The choice of the interest rate and fee combination allows brokers flexibility in working out what is best for their clients especially in calculating the ICR to meet affordability requirements.”

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John Tidswell

11:56 AM, 23rd January 2023, About A year ago

Yes the rates are great, until you take into consideration the 7% fee. On a typical £150,000 mortgage you would be looking at a fee of £10,500. I believe many people would consider this to be extortionate.

Mark C

12:42 PM, 23rd January 2023, About A year ago

Why not 3.29% with a 12% fee or a 2.79% with a 15% fee? Agree with John Tidswell that compared to what the fees used to be, these are extortionate too, however, I think we all need to look at the bigger picture.
The fees and rates from Landbay will net them more or less the same revenue (I used a 75% LTV), even the ones above, however there is a stark difference in the profit for the landlord over 5 years. Property is for the long term so I would expect the price increase to offset the fees whilst enjoying increased profits, which btw Landbay, means I am more likely to be able to afford your payments if there are void periods.
ICR is going to be a major problem for Landlords, more will most likely sell up, which is less business for the lenders


16:28 PM, 23rd January 2023, About A year ago

Reply to the comment left by John Tidswell at 23/01/2023 - 11:56
Did they not used to call these product fees "arrangement fees"?
They carry on as if they are offering something great when in reality its all the same.
I'd have thought they should not be able to to manipulate the true cost of the finance on offer. Transparancy and all that. I suspect some get caught out thinking they are getting a better deal than the reality.

Mark C

12:55 PM, 24th January 2023, About A year ago

They did call them arrangement fees indeed. When it comes to accounting and their P&L they amortise the Fee across the period and by adding it on they also get interest on it across the 5 years.
Ignoring the last bit above to make it simple for at 5.39% + 2% fee they get:
8,085 interest x 5 40,425 + fee 3000 = 43,425
at 4.29% + 7% fee they get:
6,435 interest x 5 32,175 + fee 10500 = 42,675
Pretty much the same although I didn't include the interest on the fee added to the loan.
Say your rental is £9,000, you would be refused the first loan because ICR would require 10,106 whereas the second one is 8,044
So whilst it's all smoke and mirrors but it does open the door.

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