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Saturday 22nd of November 2008
November 22, 2007

Birmingham Midshires launches buy-to-let tracker


by Gill Montia
”Birmingham

Birmingham Midshires, part of the HBOS group, has secured an exclusive distribution agreement with John Charcol, one of UK’s largest independent mortgage brokers.

John Charcol will market a new Birmingham Midshires tracker mortgage aimed at the buy-to-let market.

The mortgage guarantees to keep interest repayments at 0.06% below the Bank of England’s base rate, for three years.

It starts on a highly attractive 5.69% interest rate that will provide strong competition for other buy-to-let lenders, such as Paragon.

Loan-to-value ratio is up to 85%, which compares with a loan-to-value ratio on new business of 68%, from Paragon.

Borrowers will need to show a tenancy income to interest repayment ratio of 100%, rather than 125%, which is the norm in the buy-to-let sector.

According to an HBOS spokesman, the new mortgage offer is “part of a product refresh … we are pricing in line with the market.”

However, the new product is likely to damage the market share other buy-to-let lenders.

The launch is particularly bad timing for Paragon, which is moving towards a liquidity crisis that some do not expect the company to survive.

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Story link: Birmingham Midshires launches buy-to-let tracker


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