10:28 AM, 31st July 2019, About 3 years ago 3
This is an extremely niche BTL mortgage product, but I am sharing the details on behalf of a broker friend who specialises in this market.
It isn’t easy to get a BTL mortgage if you’re over the age of 75, let alone one that is on an interest only basis for an indefinite term, i.e. not payable until the day you die.
The minimum property value is £70,000 and the maximum LTV is 40%.
The interest rate is fixed for life from 5.63% to 5.82% which isn’t bad at all if you want/need long term certainty. It can either be rolled up indefinitely, with a guarantee of no negative equity, or serviced monthly.
The arrangement fee is fixed at £1,995. There are no valuation fees.
Unlike traditional mortgage lending, the older you are the more you can borrow. Similar products are actually available from the age of 55. If the property is owned in joint names the youngest persons age will apply. However, the maximum LTV for a person who is only 55 is just 19%. This is to factor in the guarantee of no negative equity on rolled up mortgage interest and the associated risks to the lender.
Several years ago I predicted that this form of lending would become mainstream as the BTL market matures and the average age of landlords increases. For some people, this is just the lifeline they will have been looking for, especially if they are more mature and have interest only mortgages which are due to be repaid. For others, it is good just to know these products are now available and can be considered for longer term strategic planning.
Perhaps best of all is the option to roll up interest. Until now it hasn’t been possible to have no monthly interest payments and effectively spend equity tied up in a BTL portfolio, but it is now!
Other underwriting criteria
If the LTV fits, you’re not bankrupt, the property is let on an AST and you have a pulse and permanent right to reside in the UK they you can have one of these mortgages. There is no other underwriting criteria at all.
Please note that even though these mortgage products are unregulated, I do not provide advice on whether they are appropriate for you or not and that this article must not be considered as advice. That said, if you have any questions about the product I will do my best to answer them in the comments section below.
If you would like me to refer you to my broker friend, please complete the contact form below.Show Form to get a Lifetime BTL Mortgage Quote
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