Hinckley & Rugby for Intermediaries has announced an increase to the maximum loan-to-value (LTV) available on its buy-to-let mortgage range, raising it to 80% as competition slowly returns to parts of the landlord lending market.
The lender has also launched two new discounted buy-to-let mortgage products, aimed at landlords who are struggling to find higher-LTV borrowing options in the current market.
The move comes as many landlords continue to face affordability pressures, tighter lending criteria, and higher borrowing costs following the sharp rise in interest rates over the past two years.
More options for landlords
According to Hinckley & Rugby, the new products are available to both personal landlords and limited company borrowers.
The lender says the products were introduced in response to growing demand from brokers who have seen fewer high-LTV buy-to-let deals available across the market.
Over recent years, many lenders reduced risk by lowering maximum borrowing levels on buy-to-let mortgages, particularly during periods of economic uncertainty and rising rates.
As a result, landlords often needed larger deposits or additional equity to secure finance.
By increasing its maximum LTV to 80%, Hinckley & Rugby is now offering landlords the ability to borrow a larger proportion of a property’s value.
Available for purchases and remortgages
The new products can be used for both property purchases and remortgages.
Loan sizes range from £100,000 up to £750,000, giving landlords flexibility depending on the size and value of the property involved.
The lender confirmed that both mortgage products come with:
- A £250 application fee
- A £999 completion fee
- A payable valuation fee
While fees remain an important consideration for borrowers, the higher LTV may help reduce the amount of upfront capital landlords need to commit.
This could be particularly useful for investors looking to expand portfolios while preserving cash flow.
Understanding the affordability checks
Like most buy-to-let lenders, Hinckley & Rugby uses Interest Coverage Ratio (ICR) calculations to assess affordability.
ICR measures whether expected rental income is sufficient to comfortably cover mortgage repayments.
For personal landlord applications, the lender has set:
- A 125% ICR requirement for basic-rate taxpayers
- A 145% ICR requirement for higher and additional-rate taxpayers
For limited company borrowers, the lender will apply a flat 125% ICR.
These affordability rules reflect the different tax treatment between personal and company-owned buy-to-let properties.
Why higher-LTV products matter
Higher-LTV buy-to-let mortgages became far less common after mortgage rates rose sharply during the inflation and interest rate cycle seen across 2023 and 2024.
Many lenders responded by tightening criteria and reducing exposure to higher-risk lending.
For landlords, this often meant needing much larger deposits to secure finance, particularly when refinancing existing properties or purchasing new investments.
The return of more 80% LTV products may signal growing confidence among some lenders as the market becomes more stable.
However, higher-LTV borrowing still tends to carry higher interest rates compared with lower-LTV products, reflecting the increased risk to lenders.
Challenges still facing landlords
Although more mortgage products are beginning to return, landlords continue to face several challenges across the buy-to-let sector.
Higher mortgage costs, tougher regulation, and ongoing changes linked to the Renters’ Rights Act are continuing to reshape the market.
Many landlords are also preparing for future energy efficiency requirements and higher compliance costs linked to EPC targets.
At the same time, rising rents and limited housing supply are keeping demand for rental properties high across many parts of the UK.
For some landlords, access to higher-LTV finance could create opportunities to continue investing despite the difficult market conditions.
Lender responding to broker demand
Christopher Holmes said brokers working in the buy-to-let sector have recently faced limited choice when searching for higher-LTV mortgage solutions.
He explained that the new products were introduced directly in response to those market conditions.
The lender believes the products will help brokers support landlords who may otherwise struggle to access competitive finance at higher borrowing levels.
Signs of cautious recovery in the BTL market
The launch of new 80% LTV products may also reflect broader signs of cautious recovery within the buy-to-let lending market.
While activity remains below the levels seen before interest rates surged, lenders are slowly beginning to expand product ranges again as conditions stabilise.
Landlords continue to adapt to a market that now requires more careful financial planning and stronger affordability calculations.
For borrowers with stable rental income and strong credit profiles, higher-LTV deals may provide additional flexibility at a time when raising large deposits remains difficult.
What happens next?
The direction of the buy-to-let mortgage market will remain heavily influenced by interest rates, inflation, and wider economic conditions.
If mortgage pricing continues to improve gradually, more lenders may begin reintroducing higher-LTV products over the coming months.
However, affordability checks are likely to remain strict, particularly as lenders continue balancing growth opportunities with ongoing market risks.
For now, Hinckley & Rugby’s latest move highlights how parts of the lending market are beginning to reopen to landlords seeking greater borrowing flexibility in a challenging property environment.
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