New rules from the Bank of England may restrict the ability of buy-to-let investors to remortgage to a better deal. As a result buy-to-let investors may find themselves on a standard variable rate mortgage as their current fixed rate deal ends, with possible rates of higher than 5%. Investors are also about to be hit by new tax changes, to be introduced next year, which will reduce the amount of interest that can be claimed as tax relief for higher rate tax payers
Key Takeaways:
- Buy-to-let investors with mortgages from now-defunct lenders risk being trapped on uncompetitive rates for life.
- However other, smaller, lenders appear to be considering relaxing their policy.
- Others are able to remortgage, but have a very limited choice of higher than average rates.
“Potentially worst off are those tens of thousands of borrowers who have mortgages with lenders including Mortgage Express and Cheltenham and Gloucester”