Profit is the name of the game for landlords and so making savings wherever you can is a priority.
Time to remortgage your buy-to-let property?
One option is to remortgage onto a cheaper deal to lower the monthly repayments costs of your buy-to-let loan.
The cut in interest rates by the Bank of England may mean that some landlords can make substantial savings by doing this.
This is because lenders are beginning to pass on the Bank’s cut in rates to their customers - a trend that is expected to continue in the months to come.
New exclusive figures suggest it could mean saving as much as £2,000 over the course of five years.
The data from financial group Moneyfacts found that it cost landlords £13,015 in the first year of borrowing £200,000 at a rate of 4.26 per cent - which was the average rate of a five-year fixed-rate deal a year ago. The cost rises to a total of £65,076 over the first five years.
What is currently the average rate on a five-year fixed-rate buy-to-let mortgage?
Since then, the average rate on five-year fixed-rate deals has dropped to 3.93 per cent.
This translates to a saving of £2,198.40 over five years, according to Moneyfacts.
At that rate of 3.93 per cent, it would cost landlords £12,575 in the first year of borrowing £200,000, rising to a total of £62,877.60 after five years.
Saving this amount of money would be a huge benefit to landlords.
However, the impetus to remortgage may have weakened given the cut in rates. This is because it is often only when we are faced with a rate rise that we are actually prompted into action.
Landlords can check when their current initial mortgage deal comes to an end to see if there are savings to be made by remortgaging.
Are you considering remortgaging to save money? Let us know below.