BM Solutions lets landlords switch mortgage rates and borrow more with one application

BM Solutions, previously known as Birmingham Midshires, has launched a combined application process allowing existing buy-to-let customers to switch to a new mortgage rate and apply for additional borrowing at the same time.

The lender, which is part of Lloyds Banking Group, has introduced the change for brokers arranging a product transfer and further advance for existing BM Solutions landlord borrowers.

Previously, brokers like Trinity Financial had to submit two separate applications if a landlord wanted to move onto a new rate and raise extra funds against their property. Under the new process, both elements can be submitted together, reducing duplication and making the process simpler for brokers and customers.

BM Solutions said both parts of the mortgage can be placed onto one product, subject to availability. This can give landlords a clearer mortgage structure and more certainty over their monthly payments, particularly where the whole loan is moved onto a fixed rate.

The lender has also improved its further advance portal. Brokers can now save and resume applications, produce mortgage illustrations without completing a full application, amend term lengths and repayment types across sub-accounts, and use a soft-footprint decision in principle to check eligibility before submitting the case.

Applications requiring a solicitor, such as cases involving an existing second charge on the property, will not be eligible for the combined process and will continue to follow BM Solutions’ existing route.

Why would a BM Solutions landlord switch from a variable rate to a fixed rate?

Many buy-to-let landlords with Birmingham Midshires move from a variable rate to a fixed rate because they want more control over their monthly mortgage payments. Lots of borrowers are also paying high standard variable rates. 

A variable rate can rise or fall, which means payments may change. This can make it harder for landlords to plan, particularly if they rely on rental income to cover mortgage costs, maintenance, letting agent fees, insurance and other property expenses.

A fixed rate gives certainty for a set period. This can be useful for landlords who want to protect themselves from future rate rises, stabilise cash flow and understand exactly what their mortgage payments will be each month.

Switching to a fixed rate may also help some landlords with affordability calculations. BM Solutions said aligning the full loan onto one product could improve borrowing potential, particularly with five-year fixed rates.

Why might a landlord take additional borrowing against their buy-to-let property?

A further advance allows an existing borrower to raise extra money against their property without necessarily remortgaging to a different lender.

Landlords may consider additional borrowing for several reasons, including:

Property improvements
Some landlords raise funds to upgrade kitchens, bathrooms, heating systems, windows or general décor. Improvements can help attract tenants, reduce void periods and potentially increase rental income.

Energy efficiency work
Landlords may want to fund insulation, double glazing, new boilers, solar panels or other energy-efficiency upgrades. These improvements can make a property more attractive to tenants and may help landlords prepare for future regulatory changes.

Repairs and maintenance
Buy-to-let properties often need ongoing investment. A further advance can help fund roof repairs, structural work, damp treatment or other essential maintenance.

Expanding a property portfolio
Some landlords use additional borrowing to help fund a deposit for another buy-to-let property, subject to affordability, rental income and lender criteria.

Debt consolidation
In some cases, borrowers may consider raising funds to consolidate other debts. This needs careful advice, as securing unsecured debts against a property can increase the total amount repayable and put the property at risk if payments are not maintained.

Improving rental yield
Landlords may borrow to convert unused space, refurbish a property, add an extra bedroom where permitted, or make changes that improve the property’s rental appeal.

What does this mean for BM Solutions customers?

For existing BM Solutions buy-to-let borrowers, the new process could make it easier to review their current mortgage and raise additional funds at the same time.

Rather than dealing with separate applications, landlords can now ask their broker to assess whether a combined product transfer and further advance is available and suitable.

This could be particularly useful for landlords whose current mortgage deal is ending, those sitting on a variable rate, or those who want to invest in their rental property while securing a new fixed rate.

However, additional borrowing increases the size of the mortgage and may increase the total interest paid over the term. Landlords should always check whether the new arrangement is affordable and whether staying with BM Solutions is more suitable than remortgaging to another lender.

Lending solutions with Trinity Financial

Are you looking to buy a property and require expert advice? We’re here to help you find a solution – no matter how complex your circumstances. Our expert brokers have extensive experience providing creative solutions to secure mortgages for our clients.

Call Trinity Financial on 020 7016 0790 to secure a buy-to-let fixed or tracker rate remortgage or book a consultation or use our appointment calendar

Most Buy-to-Let Mortgages are not regulated by the Financial Conduct Authority.

The information contained within was correct at the time of publication but is subject to change.  It is for general information purposes and is not advice.

Your mortgage is secured on your property. Your property may be repossessed if you do not keep up repayments on your mortgage