Redwood Bank has reduced interest rates on lower loan-to-value investment mortgages while increasing the maximum portfolio loan available to landlords.
The lender said the changes are aimed at improving affordability and giving brokers greater flexibility when structuring deals.
Rates on residential investment buy-to-let and semi-commercial mortgages now start from 4.84% for a two-year fixed product at up to 50% loan-to-value with a 5% fee, reduced from 5.59%.
For commercial investment mortgages, rates now begin at 6.34% for a two-year fixed at up to 50% loan-to-value with a 5% fee, down from 7.09%.
The bank has also increased its maximum portfolio loan from £6m to £10m across residential investment and commercial lending.
HIGHER LOAN LIMITS
Single asset limits have also been increased across a range of products.
For residential investment and semi-commercial loans, the maximum loan at up to 65% loan-to-value has risen from £3m to £6.5m, while loans at 65% loan-to-value or above have increased from £2m to £4m.
For commercial investment lending, the maximum loan at up to 60% loan-to-value has increased from £3m to £6.5m. Loans at 60% loan-to-value or above have risen from £2m to £4m.
The lender has also extended the maximum interest-only term on commercial mortgages to 20 years.
Stuart Davidson (pictured), chief commercial officer at Redwood Bank, says: “This is a deliberate and exciting step forward in our growth plans. Over the past year we have made major improvements to strengthen our proposition and resulting broker and customer experiences.
“We updated our debt service coverage approach to use gross rent, reduced stress rates on two- and three-year fixes and extended interest-only terms on residential products to 30 years.
“We simplified pricing with clear loan to value and credit quality bands and launched our new credit-backed decision in principle process for residential investment mortgages, giving brokers fast and dependable decisions.
“Alongside this, we invested heavily in our technology, upgrading systems, automating key processes and building the foundations for our broker portal, supported by the launch of our online mortgage calculator.
“With this platform now in place, we are ready for our next phase of growth by launching a 20-year interest-only term for commercial deals, a maximum single asset size of £6.5 million across all products, portfolio limits of £10 million, and an increased 1.5% procuration fee on all commercial transactions.
“These changes underline our commitment to helping landlords grow sustainably while navigating a changing market with confidence.”
Tom Worbey, senior product manager (lending) at Redwood Bank, added: “We recognise the importance of supporting landlords who maintain strong equity positions in their portfolios.
“By reducing rates on our lower LTV commercial and residential investment mortgage products, we are rewarding lower-risk customers with more competitive pricing that strengthens cash flow, supports long-term investment plans and delivers greater financial resilience.”
BROKER FEES INCREASED
Redwood Bank has also increased commercial loan broker fees from 1% to 1.5%, aligning them with its residential investment and semi-commercial products.
The lender said the change reflects the complexity of commercial lending cases and is intended to support brokers consistently across its different lending lines.
