Interest rate increase miss hitting investors

20/04/2007

A study has shown that Landlords with buy-to-let mortgages are in a good position to overcome any interest rate increase.

Paragon Mortgages have investigated that most of these investors have borrowings of nearly less than 50 per cent of their investment, leaving them with an average loan-to-value of 37 per cent.

On the last quarter’s findings this figure shows us a decrease of nearly 2 per cent and is less than any standard maximum loan-to-value of 85 per cent Paragon Mortgages spoke further.

Managing director John Heron of Paragon Mortgages, said: "Some have suggested that the succession of interest rate rises since last summer will leave property investors in financial difficulty. This is not the case. "

Landlords are well placed to take the further expected rate rise in their stride," he stated.

John Heron also said that nearly more than 70 per cent of investors currently with buy-to-let mortgages have taken out not long ago fixed-rate products, this shows the knowledge of landlords and investors to not show themselves to any big risks without knowing the consequences.

During February period the amount of houses in a landlords portfolio increased to 11.1 from 10.2 November 2006 period, this figure was brought forward by the financial product provider.

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