Six buy-to-let lenders now offering 80% deals

Six mortgage lenders are now offering a total of 21 buy-to-let mortgages with LTVs of up to 80%.

According to data from Mortgage Flow, specialist broker Mortgages for Business’s buy-to-let mortgage sourcing tool, the six now offering 80% LTV or above are Kent Reliance Banking Services, Saffron Building Society, Leeds Building Society, Aldermore Mortgages and as of today, Clydesdale Bank.


From December 2008 to May 2010, the highest possible LTV for a buy-to-let mortgage was 75%. The first sign that the tide was about to turn came from The Mortgage Works on May 9, 2010, when it introduced a limited range of products to 80% LTV.

Investors then had to wait another nine months for another lender to do the same. On that occasion the entrant was Kensington which introduced a solitary product to a headline hitting 85% LTV. Kensington has since withdrawn from buy-to-let lending.


David Whittaker, managing director at Mortgages for Business, said the fact that there are now six lenders offering 80% buy-to-let products demonstrates growing confidence among lenders in the sector.

He said: “Between them, there is a good range of products on offer from two-year discounted trackers to five-year fixed rates. Some even come with flat arrangement fees which really start to make sense for investors looking to borrow larger sums.”

*There are now a total of 486 buy-to-let mortgage deals available, a 26% increase on the 386 available last February, and exactly double what there were in February two years ago, according to Moneyfacts.

The average interest rate for buy-to-let borrowers is currently 4.79%, down from 5% from February last year and 5.31% in February 2010 when there were 243 deals available.

Louise Holmes, spokeswoman for Moneyfacts, said: “These latest figures, particularly a reduction in the average rate, should make pleasing and encouraging reading for landlords and property investors.

 “The increase in demand for rental properties has resulted in a degree of competition returning to the buy-to-let sector, giving it a well-needed boost.”