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TODAY'S OTHER NEWS

Buy-to-let loan numbers hit record high

The number of buy-to-let products on the market has hit a record high, although the pace of growth has slowed lately.

There were 839 buy-to-let mortgage products from 31 active lenders in the first quarter of this year, up 21 products on the previous quarter, according to the latest Buy to Let Costs Index from Mortgages for Business.

Whilst the rate of growth in the number of buy to let products has reduced, the trend is still upwards. 

The quarter saw the launch of Foundation Home Loans and State Bank of India and these two lenders account for all of the increase in product numbers in the quarter.

There was also growth in product numbers across all LTV bands.

Five-year fixed rate mortgages were the fastest-growing segment, along with lifetime trackers.

Last quarter, Mortgages for Business reported that fixed rate mortgages are generally being offered at lower rates than their equivalent tracker products. 

This has become even more pronounced in Q1 2015, as trackers have generally drifted higher in price, whereas fixed rates have remained at much the same level.

In both cases, higher-LTV loans have become slightly cheaper.

Two-year fixed rate mortgages are now around 0.5% cheaper than trackers. Both three and five year fixed rate mortgages are similarly priced to trackers.

Mortgages for Business said that fixed rate mortgages at two, three and five years are offering considerably better value than trackers. 

And it said the spread in cost between low LTV mortgages and high LTV mortgages has stabilised at around 1.5% to 2%, compared with around 1% in early 2013, with lenders keen to attract low-LTV business.

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