Landbay, the buy-to-let lender, is offering two new products for first-time landlords to invest in HMOs (houses in multiple occupation). They are now one of the few lenders who do not require some landlord experience before granting a loan on this type of property.
This new initiative comes after broker feedback revealed that first-time landlords have gained knowledge in this area and are making more enquiries.
The products are a 2-year fixed rate at 3.29% and a 5-year fix at 3.79%. Both are available up to 70% LTV with a fee of 1.5% for HMOS with up to six bedrooms. New-build properties will also be considered.
This news follows the launch of two new products designed for landlords with three or less properties; a two-year fixed rate at 2.85% and a five-year fixed rate at 3.25%, both at up to 65% LTV and available on loans up to £1.5m.
Paul Brett, managing director at Landbay, said: “Landlords are becoming more sophisticated and they understand the responsibilities of managing an HMO.
“They have done their homework and know the yields on HMOs are much higher than single flats or houses resulting in greater financial rewards.”
“There is also more demand for living in HMOs, particularly from young professionals who want or need to share a house.
“Some simply can’t afford to rent their own place but many actually like communal living.
“Much of the HMO accommodation is far better quality than it used to be and can demand a higher rent.”
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Landbay also now offers a green mortgage range, offering rates up to 0.1% lower for properties with qualifying energy ratings. These green rates are only for properties that have been registered for at least 24 months with an energy performance certificate (EPC) rating of C or above.