We only use cookies for website functionality and security.

Paragon Bank takes up to 70bps off five-year fixes and reduces reference rate, amidst broader criteria changes

Louisa Sedgwick - 0523 920x518.jpg

  • Rates on five-year fixed rate buy-to-let mortgages reduced by up to 70bps
  • Five-year reference rate reduced from 5.50% to 5.00%
  • Changes to minimum experience and maximum loan term criteria 

Paragon Bank has reduced rates on five-year fixed-rate buy-to-let mortgages by up to 70bps, in addition to lowering its reference rate and making changes to minimum experience and maximum loan term criteria.

Rates on Paragon’s five-year fix, that comes with a 5% fee, have been reduced from 5.20% to 4.50% for the purchase or remortgage of single self-contained properties. For energy efficient homes with EPC rating of A-C, the rate is 5bps lower at 4.45%, while Houses in Multiple Occupation (HMOs) and Multi-unit blocks (MUBs) can be mortgaged at 4.70%.

Following a reduction in Paragon’s reference rate, from 5.50% to 5.00%, interest coverage ratios (ICR) are calculated in line with initial rates, except for sub-5% products whereby ICRs are calculated at 5.00%.

Paragon has also extended its maximum loan term from 25 to 35 years, while reducing the amount of experience buy-to-let landlords are required to have for HMO & MUB applications, down from a minimum of three years to two.

Other rate cuts include a 55bps reduction, from 5.94% to 5.39%, on a five-year fixed-rate nil fee product that comes with £750 cashback. Paragon’s EPC C and above loan is again 5bps lower at 5.34% and increases to 5.59% on HMOs and MUBs.

These products are available at up to 75% loan-to-value (LTV) for landlords applying through limited company structures or in personal name in England, Scotland and Wales.

Louisa Sedgwick, Commercial Director at Paragon Bank, said: “It’s great to get the year off to a positive start by taking up to 70bps off our 75% LTV five-year fixed-rate mortgages. With a mix of 5% and nil fee options, some with £750 cashback, we’re aiming to offer products that work for more landlords.

“This is also a key driver in our decision to reduce our reference rate from 5.50% to 5.00%. We’ve listened to brokers who have told us that the most important consideration for their clients when sourcing mortgages is affordability so calculating ICRs at a lower rate will help with this. Additionally, we have eased some of our criteria across the maximum loan term and minimum experience for HMO and MUB applications.”

For more information, including Annual Percentage Rates of Change (APRC) and Early Redemption Charges, please visit the Paragon website here.

For media enquiries contact:

Jordan Lott
Media Relations Manager
Tel: 0121 712 2319
[email protected]

Notes to editors:

Paragon lends to private individuals and limited companies and provides mortgages suitable for single, self-contained properties, as well as HMOs and multi-unit blocks. Paragon can accommodate higher aggregate lending limits and more complex letting arrangements including local authority leases and corporate leases along with standard ASTs.

Paragon Bank PLC is a subsidiary of the Paragon Banking Group PLC which is a FTSE 250 company based in Solihull in the West Midlands. Established in 1985, Paragon Banking Group PLC has over £14 billion of assets under management, helping more than 340,000 customers to achieve their ambitions.