Redwood Bank has lowered the interest rates on loans as part of efforts to help with affordability and flexibility.
The reductions apply to loans up to 60% loan to value (LTV).
In addition, the bank has upped its maximum portfolio loan to £10m across residential investment and commercial lending, as well as lengthening commercial interest-only terms to 20 years.
The specialist business lender confirmed that for residential investment buy-to-let (BTL) and semi-commercial mortgages, rates now start from 4.84% for a two-year fix at up to 50% LTV with a 5% fee. This marks a reduction from 5.59%.
For commercial investment mortgages, a two-year fixed rate at up to 50% LTV with a 5% fee will now start from 6.34%, down from 7.09%.
Alongside these alterations, Redwood Bank’s maximum portfolio loan across residential investment and commercial products has risen from £6m to £10m.
The new-build energy advantage
Sponsored by Halifax Intermediaries
Single asset limits have also risen significantly; residential investment and semi-commercial deals up to 65% LTV have gone from £3m to £6.5m. Meanwhile, its offerings at 65% LTV or more have risen from £2m to £4m.
For commercial investment, deals up to 60% LTV will be increasing from £3m to £6.5m and those at 60% LTV or higher will go up from £2m to £4m.
Stuart Davidson (pictured), chief commercial officer of Redwood Bank, said: “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.”
He added: “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 £6.5m across all products, portfolio limits of £10m, 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, the firm’s senior product manager for lending, 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.”
