Foundation Home Loans is launching new buy-to-let two-year fixed-rate specials as it also introduces a new rental stress test change for shorter-term products.
The new specials include F1 two-year fixes with rates starting at 5.39%, a 1% fee and one free standard valuation,
F2 two-year fixed rates starting at 5.49% with a 1% fee, and F2 HMO two-year fixed rates starting at 5.54% with a 1% fee.
Foundation said the new products were designed to support the introduction of its simplified ICR stress tests for shorter-term products below a five-year term including fixed and discounts, which will now be based on the higher of either the pay rate plus 2% or a flat 8%.
Earlier this month Foundation launched other special buy-to-let rates including F1 five-year fixed rates starting at 5.54% with a reduced fee of 1.5% and one free standard valuation, and owner-occupied specials rates with reductions of up to 0.35% on F1 products, now starting at 5.74%.
Foundation Home Loans managing director George Gee comments: “To further support those looking for shorter term products we have chosen to improve our ICR stress test for shorter term rates, simplifying it to either a pay rate plus 2% or a fixed 8%, whichever is the higher. Our stress test on five-year products is unchanged – calculated at pay rate”.
Gee adds: “The launch of these new products in the two-year fixed-rate space for landlords, utilising the new stress test calculation, should open up new maximum loans for a number of borrowers wanting shorter term products”.
