The new buy-to-let deal, available from November 4th, will be made up of a conventional buy-to-let mortgage for up to 65% of the property’s value, topped up with a second charge equity loan of a maximum of 20% of the property’s value.

Landlords do not pay any interest on the equity loan, but pay back the original loan plus a percentage of any the increase in value of the property when they redeem the loan.

Paul Howard, managing director (mortgages) at Castle Trust said:

“This is hugely exciting for any buy-to-let investor who wants to grow their portfolio. For example, a customer with buy-to-let borrowing of 70% loan-to-value (LTV) can double the size of their portfolio using our product. So long as the case meets our underwriting criteria and the underlying primary mortgage passes its lender’s usual stress test, we will provide additional equity up to 85% LTV with no additional cashflow strain.”

Loans will initially be for any term up to maximum of 10 years with a 5% early redemption charge only in the first year.

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Andy Young CEO of mortgage brokerage TBMC said:

”This is a very important development in the buy-to-let market and The Business Mortgage Company is pleased to be partnering with Castle Trust to distribute this unique offering.”