Paragon Bank, the specialist lender, has introduced a range of 80% LTV buy-to-let mortgages, for properties with an energy performance certificate rating of A to C. The lender has extended its standard 75% LTV as an incentive for landlords to invest in energy efficient properties.
The new five-year fixed rates are offered for portfolio landlords for purchase and remortgage, at 3.99% for single self-contained properties and 4.19% for HMOs. Both products include free valuations with no product fees and £350 cashback.
Whilst the number of properties in the private rental sector with an energy rating of A-C has increased by 272% to 1.8 million over the last ten years, approximately six out of 10 homes are still rated at grade D or below.
Richard Rowntree, managing director of Mortgages at Paragon Bank, said: “Landlords have made great strides in adding more energy efficient homes to the PRS – or upgrading properties to C or above standard – over the past decade. However, more needs to be done as the Government moves towards its net zero carbon target by 2050 and landlords have a key role to play in that.
“Our new range of products at 80% LTV for homes with an energy rating of C or above will be an incentive for landlords to add energy efficient homes to the sector, benefitting tenants through lower energy bills and the environment through reduced consumption.”
“If landlords are to improve the energy efficiency of PRS stock, they need the finance to enable them to do so. Making sure there are attractive options to add new stock, whilst recognising the efforts to upgrade existing properties, is an important element of this.”
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At the start of this year, Paragon provided £8 million for the second phase of a development for Horsnall Holdings. The development, named The Gate, will will be comprised of 64 homes, both one and two-bedroom apartments, in Loughborough.