Family Building Society launches offset buy-to-let mortgage
The Family Building Society has launched an offset buy-to-let mortgage designed to help landlords make better use of their savings.
The society's offset mortgage is a competitively priced 2.99% discounted rate for two-years. After the initial two-year period, the 2.30% discount is removed and the rate increases the lenders current standard variable rate - which is currently 5.29%. The overall cost for comparison is 5.03% APRC.
Aaron Strutt, product director at Trinity Financial, says: “Most of the lenders do not offer offset buy-to-let mortgages so this is an unusual product. Any funds in the linked savings account are automatically deducted from the amount of interest charged, while landlords can withdraw their savings so they are available for other purposes.
“To work out the maximum mortgage loan size, the building society has two rental calculations. You will able to borrow more money if you are remortgaging without raising additional capital.”
The 2.99% rate has a £999 arrangement fee and £175 application fee, although the application depends on the size of the mortgage. Early repayment charges apply for the first two-years, and landlords will need a 35% deposit to qualify.
There is no set maximum loan size and this mortgage is available to individuals, not limited companies.
Representative example: A mortgage of £250,000 payable over 25 years, initially on a discounted variable rate for 24 months at 2.99% and then on a variable rate of 5.29% for the remaining 23 years, would require 24 monthly repayments of £1,184.23 followed by 276 monthly repayments of £1,480.74. The total amount repayable would be £438,626.81 made up of the loan amount, plus interest (£187,105.76) and fees of £999. The overall cost for comparison is 5.03% APRC representative.
The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration.
To secure an offset buy-to-let mortgage call Trinity Financial on 020 7016 0790.