Our latest finance update covers:
Over Q2 the finance market and many economists have been warning that the UK is going to see higher inflation, with the market pricing in two base rate increases through to the end of 2026. Following the June meeting of the BOE monetary committee, sentiment seems now to have changed. There has been a series of economic readings which have come in better than forecast allowing the BOE to make the decision to hold the current base rate. This has resulted in many across the markets to now believe that the base rate will not rise for the rest of the year. This about turn in sentiment has therefore led to a softening of swap rates which influence many mortgage and loan fixed rates.
With oil prices falling and ships moving through the Gulf once more, many economists and market traders are starting to contemplate rates staying at the current base rate of 3.75% for the rest of 2026.
Lenders have subsequently been fine tuning their fixed rates, removing any built-in insurance for rates rising, which is leading to a calm environment for investors looking to finance new purchases or refinances.
It can be a dilemma for an investor to know the best time to start a loan application in rising or falling rate markets, the current flat rate expectations should allow time for more informed decisions to be made.
July and August can be a good time to apply for a mortgage with reduced numbers of finance transactions over the summer. Indeed, a refinance or new purchase can potentially move at a much faster pace, compared to a more active environment in the September to November period. Knowing that rates are expected to remain steady for the rest of the year, should provide the confidence to move forward with your funding requirements.
Many of the loans we assist with require structured and tailored finance, this can involve specialist teams within lenders and sometimes the use of more than one lender. Many of the properties require asset management and specialist lenders to tailor a custom finance strategy for the investor or developer.
With most investment loans having a maximum term of five years, in reality it means that every four and a half years it is time to look at your options. The exception will be any CBIL support loan that you may have taken in 2021-2022 which will have a six-year loan term.
If you are interested in information within the update, please let me know and I will obtain specific loan terms for you, all rates are available with interest only. It is possible to secure lower rates of interest for BTL with a higher fee up to 5%.#
LTD Company BTL / Portfolios £500k – £20m
Up to 55% LTV
Up to 75% LTV
HMO
Max LTV 75%
Up to six bedrooms £500k-£3m Five year fixed rate 5.4%. Fee 2%.
Max LTV 70%
7-20 bedrooms £500k – £3 Five year fixed rate 5.8%. Fee 2%.
Multi-Unit Freehold Block
Max LTV 65% £300k – £20m Five year fixed rate 5.65%. Fee 2%.
Max LTV 75% £300k – £20m Five year fixed rate 5.85%. Fee 2%.
Semi – Commercial Investment Loans / Residential must be 50% or more of square footage
Max LTV 55% £400k -£5m Five year fixed rate 5.55%. Fee 2%.
Max LTV 75% £400k – £5m Five year fixed rate 6.3%. Fee 2%.
Floating rate £750k – £15m 2.1% over BOE base rate. Fee 2%.
Commercial Investment
Max LTV 60% £3m-£30m 1.4 – 1.8% over BOE base rate. Flexible fee.
Small Loans Residential & Commercial
Max LTV 65% £250k – £750k 1.3 – 1.65% over BOE base rate. Fee 1.5%
Lower Cost Green Development Loans
Developers who are targeting green energy efficient developments are now able to benefit from a lower cost green development loan. The base rate for the development facility is 9% – this rate can be reduced by up to 2% by meeting a number of green energy efficient standards.
There are ten criteria. To qualify for a discount of 1.25% four of the criteria needs to be met. For the full 2% discount producing an interest rate of 7%, a minimum of six of the criteria need to be met.
To be considered, all homes must be fossil fuel free with an average SAP score of 85 +
Loan size £2-20 million
Houses & Flats
Standard Development Finance
There are a number of attractive development loans being launched this year, one of the most interesting for standard EPC rate developments:
There is a lot of competition in the bridging loan market at the moment, the most common loans that I see requested:
Development Exit: Up to 70% of the value with an interest roll up facility from 3.9% over BOE base rate.
Below Market Value Purchase: Up to 90% of the purchase price capped at 70% of the value can be remortgaged to BTL with same lender.
Stepped Rate loans: From 0.35% per month for six months, at that point the rate increases.
Planning loan: Up to 60% LTV of the existing use value from 0.75%pcm.
If you have a development to finance please call me to discuss for tailored terms, this covers the smaller developments up to very large mixed use or special purpose schemes.
Alternatively if you are looking at a different real estate finance requirement please call me or email a summary of the deal.
Acuitus Finance uses a commercial finance sourcing system with access to over 100 specialist property lenders covering commercial property investment, residential property investment, development finance and bridging finance.
To find out how Acuitus Finance can support your investment plans, contact us today.
Stuart Buchanan
Acuitus Finance
+44 (0)20 7034 4850
+44 (0)7879 432868
