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TODAY'S OTHER NEWS

Sharp rise in limited company applications from buy-to-let landlords

A growing number of buy-to-let landlords are making mortgage applications via limited companies, according to the Buy to Let Club.

The trend supports other findings that have reported similar patterns in the market in response to the new stamp duty surcharge, as more landlords seek to reduce tax liability, including mortgage interest tax relief cuts to be phased in from 2017.

According to Mortgages for Business, both applications and completions for limited company borrowers appear to have now stabilised at around one third of all buy-to-let business.

Ying Tan, managing director of Buy to Let Club, said: “We saw an unusually high number of limited company applications in June this year totalling 22% of our packaged cases and July has proved to be another strong month.

“We are seeing limited company rates falling as competition in the market heats up in preparation for the tax changes in 2017 and landlords are clearly taking advantage of this.”

Precise Mortgages has responded to the rise in the number of buy-to-let loans applied for via limited companies by launching an exclusive limited company buy-to-let three-year fixed rate mortgage through Buy to Let Club.

The product is fixed at 3.54% until 31 October 2019 up to 75% loan-to-value (LTV). It has an arrangement fee of 1.5%, while early repayment charges are 3% until 31 October 2017, followed by 2% in the following two years.

Alan Cleary, managing director at Precise Mortgages, commented: “We work closely with Buy to Let Club in mortgage product design and this type of product is growing in popularity and I expect it to be a popular choice amongst brokers and landlords.”

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