Buy-to-let mortgage rates are falling — but only if you have a big deposit.
The average two-year rate for borrowers with a 40 per cent deposit has dropped from 2.59 per cent to 2.27 per cent in the past 12 months.
Last month, Santander launched a top two-year deal at 1.44 per cent. Platform, part of the Co-operative Group, also has a new deal at 1.54 per cent.
New deals: The average two-year deal for borrowers with a 40% deposit is 2.27%
Monthly repayments on a £150,000 loan would be £596 and £603 respectively. The total cost with Santander is £16,295, and Platform £16,464 — both include a £1,999 fee.
But if you have less than a 40 per cent deposit, rates are starting to creep up. If you have a 30 per cent deposit, the average rate has risen from 3.02 per cent to 3.17 per cent in the past month alone.
David Hollingworth, of broker London & Country, says: 'Forthcoming tax hikes and tougher criteria for loans means some landlords are desperate to switch to a better rate.
'Lenders are fighting over themselves for the best customers — those with bigger deposits.'