Products

Paragon, Zephyr and Pepper update BTL ranges



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Paragon Bank, Zephyr Homeloans and Pepper Money have announced changes to their BTL ranges.

Paragon Bank

Paragon Bank has added four new five-year fixed-rate mortgages to its BTL portfolio range.

Available at 70% and 75% LTV, the products are suitable for portfolio landlords with four or more mortgaged properties, operating as individual landlords, limited companies or limited liability partnerships.

Rates start at 2.95% at 70% LTV and 3% at 75% LTV for clients purchasing or remortgaging properties with an EPC rating between A and C.

Meanwhile, for homes which are rated below EPC C, rates are priced at 3.05% at 70% LTV and 3.10% at 75% LTV.

All four mortgages are offered with free valuations and £750 cashback.

The specialist lender has also removed the £100,000 minimum loan requirement from selected products. 

All five-year products include an interest coverage ratio (ICR) starting at 4.00% and are subject to ERCs of 5% in years one and two, 4% during years three and four and 3% for year five.

Moray Hulme, director for mortgage sales at Paragon Bank, said: “Our recently refreshed product range has proven popular, suggesting that landlords have been actively modifying their portfolios, whether that is boosting PRS stock through purchasing additional properties or taking advantage of the current low-rate environment to get a good remortgage deal. 

“To support this, we’ve added four new products, again offering preferential rates to incentivise energy efficient properties, and also removed the £100,000 minimum loan on mortgages where percentage product fee is applicable, providing more flexibility for investors.”  

Zephyr Homeloans

Zephyr Homeloans has cut rates across its BTL product range by up to 20 basis points.

Its five-year fixed-rate standard product at 75% LTV — available for properties with a D or E EPC rating — is now priced at 2.84%.

The lender has also lowered rates for its 65% LTV fixed options for standard new build properties and flats above commercial dwellings with A-C EPC ratings, which are now offered at 2.69% for a five-year term and 2.50% for a two-year term.

Paul Fryers, managing director at Zephyr Homeloans, said: “2022 is shaping up to be a year of opportunity for brokers to engage with their customers on the drive to increase the energy efficiency of rental properties as well as the significant re-mortgaging opportunity arising from maturing five-year, fixed-rate products.

“We’re able to reduce our rates and enhance the products available to brokers and their landlord clients to take advantage of these important market changes.”

Pepper Money

Pepper Money has made several improvements to its BTL criteria.

The specialist lender has lowered the minimum income requirement to £15,000 for existing landlords, and lifted some restrictions around limited companies.

In addition, Pepper has made gifted deposits allowed, and has reduced the required time in current employment from six to three months and the time required for continuous employment from 12 to six months in order to open its proposition to a broader group of customers.

For its limited company BTL proposition, the lender has removed the restriction for the main director to be a homeowner and will now allow deposits into a BTL special purpose vehicle as cash or property transfer from another limited company.

Pepper is also now able to allow rental income as a standalone income stream for professional landlords with 11 properties or more, and has increased its maximum loan from £1m to £2m and aggregated customer exposure from £3m to £4m.

Paul Adams, sales director at Pepper Money, said: “At Pepper Money, we are constantly striving to make it as easy as possible for new customers to experience our award-winning service and access our straightforward mortgages. 

“We’re delighted to open up our proposition to more BTL customers with our latest criteria improvements, which mean we now allow gifted deposits and require fewer months of continuous employment.

“A growing number of landlords are choosing to build portfolios within limited company structures, and this has been another key area of focus for us in enhancing our proposition. 

“Our transparent and hands-on approach to underwriting supports these improvements to our criteria. 

“They will provide new options for brokers to place applications for their BTL customers, there's more where this came from, so I'd encourage brokers to get registered with Pepper Money ahead of further improvements to our BTL range this year.”

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