Name and Address
Clydesdale Bank PLC (trading as Virgin Money), Jubilee House, Gosforth, Newcastle upon Tyne, NE3 4PL
Purpose of Credit
The credit can be considered for buy-to-let property purchase, remortgages and additional borrowing (including capital raising).
All requests will be subject to our lending policy at the time.
The Property
All credit provided by Clydesdale Bank PLC (trading as Virgin Money) under a regulated mortgage contract will be secured by a first legal charge over a residential property within the United Kingdom.
Our buy-to-let mortgages are available for single properties up to a maximum loan amount of £1 million. The total value of all buy-to-let properties held with Virgin Money can be up to £3 million or up to 5 properties. The maximum number of mortgaged buy-to-let properties you can hold across all lenders is usually 10.
Buy-to-Let Mortgage Terms
The minimum term for a new buy-to-let mortgage is 5 years.
The maximum term for a new buy-to-let mortgage is 35 years.
There is no set minimum term on additional borrowing applications, for an existing buy-to-let customer, the term minimum will depend on the product you choose.
Our Types of Interest Rates
We have a range of products available including both fixed and tracker rates.
Tracker rates change in line with the Bank of England base rate. Your monthly payment becomes cheaper if rates fall, more expensive if rates rise.
Fixed rates remain the same for the duration of your fixed rate period (2, 3, 5, 7, 10 or 15 years) giving you the certainty of fixed monthly payments for a set period.
Buy To Let Variable Rate is our interest rate for buy-to-let loans, which can be varied at any time during the duration of the mortgage.
Other types of interest rates may be available from time to time but in all cases, full details of any applicable interest rate(s) will be provided in any Illustration.
Representative Example
A mortgage of £91,600 payable over 25 years on a fixed rate for 2 years at 5.24%, followed by our current Buy To Let Variable Rate of 8.44% for the remaining 20 years would require 60 monthly payments of £402.58 and 240 monthly payments of £646.70 plus one initial interest payment of £411.99. A final payment of £92,595.00 for the loan amount and fees added to the loan will be due at the end of the term.
The total amount payable would be £272,557.79 made up of the loan amount plus interest (£179,774.79) and a product fee (£995), a valuation fee (£163) and a funds transfer fee (£25).
The overall cost for comparison is 7.6% APRC representative.
Costs Associated with Buy-to-Let Mortgages
Our tariff of mortgage charges will detail any additional costs that may be applicable during the term of your mortgage. This will be provided with any Offer of Loan.
Other costs to consider:
Inspections and certificates for things like gas safety, electrical installation condition, energy performance and inventories.
The cost of any minor repairs required before tenants move in.
Taxes like income tax, stamp duty and capital gains.
Furnishing costs – you can choose to let your property out with or without furniture and your rental price will probably reflect this.
Refurbishment costs if you plan to buy a property to improve or update.
Letting agents – you may choose to find your tenants with the help of an agency, who will charge for this service.
Maintenance and repair of the property in the long-term.
Void periods - there may be periods where you don’t have a tenant so your mortgage payments won’t be covered by rental income.
Landlords insurance - this can cover things like damage to your property, fittings and contents, legal costs and even tenant default.
Repayment Options
Repayment - Pay off some of the interest on your mortgage, plus some of the original loan amount every month. Once your payments have finished, the whole mortgage is paid off. This option is not available for first time buyers and the maximum loan to value (LTV) is 80%.
Interest only - Only pay off the interest on your mortgage each month. You'll need to make other arrangements to pay off the original loan amount that you borrowed, such as a savings or an investment plan. This option is not available for first time buyers and the maximum loan to value (LTV) is 80%.
Part and part - A combination of the repayment and interest only. With this mortgage, when your payments finish you'll still need to pay off the remainder of the original loan amount. You will need to make arrangements to pay off this element of the loan, such as a savings or an investment plan. This option is not available for first time buyers and the maximum loan to value (LTV) is 80%.
Your Illustration and Offer will detail the number, frequency and the amount of each payment.
It is possible that after making all your contractual repayments that a small residual balance may remain outstanding at the end of your mortgage term. We will contact you should we require any further payment, although in many instances this will not be required.
Early Repayment Charge
If you wish to repay your loan before the end of your mortgage term you can, however there may be a charge for doing this. Details of the terms and conditions relating to early repayment will be shown in your Illustration.
Property Valuation
In order for us to consider any new application for a buy-to-let mortgage, a valuation of the property (which will provide security for the credit) will be required.
Virgin Money is responsible for obtaining the valuation and it is for our sole benefit of assessing the adequacy of the property as security for the loan. Please note that the minimum property value for a buy-to-let mortgage is £50,000. Read our Tariff of Mortgage Charges for more information on valuation fees.
House Building Insurance
With all Virgin Money Mortgages, your property must be adequately insured under an acceptable buildings insurance policy.
If You Don't Repay Your Mortgage
The loan will be secured over the property. This means that if you are unable to meet your repayment obligations under the mortgage contract we may appoint a 'receiver of rent' or take possession of the property and sell it to repay the debt (after obtaining any necessary court order).