New 10-year loan for buy-to-let customers

Property investors looking for a long-term alternative to a bridging loan can now get a 10-year term loan from Castle Trust.

Castle Trust has launched its TermTen, a loan for buy-to-let owners, which offers a 10-year term that is fixed for five years before reverting to the lender’s standard variable rate (SVR).
The loan offers an annualised rate from 4.49% and has no early repayment charges payable after five years. It is available on buy-to-let properties with serviced interest and a maximum loan-to-value of 75% for loans of over £500,000 and 80% LTV for loans of £500,000 or less. It has a minimum loan size of £50,000 to a maximum of £15m.

Explaining why the TermTen loan was created, Marcus Dussard, sales director at Castle Trust, said: “We have seen increasing demand from property investors for loans that can deliver the flexibility and lending appetite of traditional bridging, but with longer terms that can provide them with peace of mind. The market is changing, and while there remain plenty of opportunities for investors, those opportunities tend to be longer-term – with a flat property market and stagnant house prices providing little for short-term investors to get excited about.

“TermTen has been developed as a direct response to this demand from investors, providing them with the safety of a 10-year term and the flexibility to refinance penalty-free after five years. The rates are very competitive compared to other options in the specialist buy-to-let market and we will also be able to provide an exit to the loan, to provide clients with multiple options throughout the 10-year term.”

Meanwhile, customers looking to secure a traditional bridging loan can now be verified through an electronic ‘facial recognition’ ID verification service. The system has been introduced by United Trust Bank (UTB) for its bridging customers wanting to borrow £1m or less and is based on a bespoke smartphone App, which was successfully rolled out to UTB’s mortgage customers in September 2019.

Customers using the Nivo App can be verified within just 90 seconds. Commenting on the launch of the new system, Gavin Diamond, commercial director of bridging at United Trust Bank, said: “The introduction of the Nivo ID verification service for qualifying bridging loans will certainly make the application process quicker and easier for customers and their brokers. Nivo’s cutting-edge solution will improve the process for all parties. UTB’s mortgage customers have been benefitting from the service since September last year and we have been working closely with Nivo to enable the innovative service to be applied across more of our products.

“At UTB, we are keen to introduce innovative fintech solutions where they help to streamline and simplify customer and broker journeys. We enjoy working with leading technology providers such as Nivo to improve efficiency. This enables us to devote more time to delivering a personal service and add value through our individual underwriting.”