Neil Soundy Financial Services - Green Buy-to-let Mortgage - Lower rates for landlords

Green Buy-to-let Mortgage - Lower rates for landlords

Background

From April 2018, landlords have been required to achieve a minimum rating of E on the Energy Performance Certificate (EPC) for their rental property for new tenancies or tenancy renewals. Since April 2020, this was extended to cover existing tenancies, meaning all rented properties now need to have an EPC rating of E, even where there has been no change in tenancy.

This is a part of the Government strategy to make carbon-neutral by 2050

Under consideration

Under Government proposals, by 2025, homes in the private rented sector will need a minimum EPC rating of C for new tenancies and in 2028, this may extend to all properties even where there has been no change in tenancy. 

Green Mortgage Rating

The EPC rating to obtain a Green Mortgage is A, B or C.

Lenders

The mortgage market for green buy to let mortgages is niche but growing.

Most of the major lenders offering personal and limited company/SPV mortgages have launched products. The major exception to this currently is BM Solutions.

Mortgage Benefits

The major benefits for the landlord meeting the higher EPC requirements are: 

  • Lower rates
  • Lower lenders arrangement fee
  • Higher loan to values
  • Future proof the property against future legislation

Example - (01/09/2021)

  TMW (Green Mortgage) Foundation Home Loans
Rate 3.74% 3.99%
Lenders Fee (added) £995 fixed £3, 000 (1.5% of mortgage advance)
Monthly (interest only) £626.43 £674.97

The saving over 5 years is £2,912 in mortgage payments and £2,005 in the arrangement fee.

The way forward?

The obvious route for landlords to take advantage of green mortgages is to purchase a new build or recently constructed property. Recent research shows that 84.4%  of new built homes have an EPC rating of A or B compared to 2.2% of existing stock.

The other time to review your options is when you intend to refurbish/remortgage an existing buy-to-let. You could obtain 2 quotes: one quote to keep costs to a minimum; and a second that includes raising the EPC to at least a C rating. This would future proof the property against future legislation.

CONTACT US FOR THE CURRENT RATES AND A FREE CONSULTATION

Why Use Neil Soundy Financial Services For Your Mortgage Advice?

  • We are experts in complex lending
  • We are experts in SPV/Ltd Co lending
  • Your initial consultation is free with no obligation

What Our Clients Say

What you see is what you get with Neil Soundy FS! Very professional, very experienced and always on time. Securing mortgages on 2 properties simultaneously using SPV was unbelievable and amazing. We would always recommend Jake, a man that knows his onions, very brilliant at his job!

F Babarinde

CHECK OUT OUR CLIENT REVIEWS

How Much Will It Cost Me For Your Advice?

A fee of £395 is payable on completion of the mortgage and Neil Soundy Financial Services Ltd will keep the commission received from the lender for arranging the mortgage.


Neil Soundy Financial Services Ltd is an appointed representative of HL Partnership Ltd which is authorised and regulated by the Financial Services Authority.

We do not give or imply legal or taxation advice. We recommend you contact a solicitor or account for advice in these areas

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Neil Soundy Financial Services Ltd
66 Albany Road, Cardiff CF24 3RR

Tel: 02921 159 466 | 020 3011 0662

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