Redwood Bank has announced that it has reduced interest rates on residential investment BTL mortgages to support affordability and improve landlord cash flow.
Rates for residential investment BTL and semi-commercial mortgages now start from 4.84% for a two-year fixed at up to 50% LTV with a 5% fee, down from 5.59%. The move forms part of a wider set of changes designed to give brokers greater flexibility when structuring deals.
Redwood has also expanded its lending capacity, increasing its maximum portfolio loan from £6m to £10m across residential investment and commercial lending.
Commercial pricing also reduced
The bank has also lowered rates for commercial investment mortgages. Pricing now starts from 6.34% for a two-year fixed at up to 50% LTV with a 5% fee, reduced from 7.09%.
Alongside the pricing changes, Redwood has extended commercial interest-only terms to 20 years, giving borrowers additional flexibility when structuring long-term investments.
Higher limits for larger assets
Single asset lending limits have increased across residential investment, semi-commercial, and commercial products.
For residential investment and semi-commercial mortgages:
Up to 65% LTV: maximum loan increased from £3m to £6.5m
65% or more LTV: maximum loan increased from £2m to £4m
For commercial investment mortgages:
Up to 60% LTV: maximum loan increased from £3m to £6.5m
60% or more LTV: maximum loan increased from £2m to £4m
Stuart Davidson, chief commercial officer at 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 the 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 per cent 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.”
