Paragon Bank has cut the rate on its core two-year buy-to-let fix by 45 basis points, which now starts at 4.85%. 

The lender says rates on two-year fixes are priced at 4.85% for single self-contained properties with energy performance certificate ratings of A to C — and 4.90% where the energy performance certificate is rated D or E.  

Interest coverage ratios on these deals are calculated at 6.85% and 6.90%, respectively. 

The business also offers a two-year BTL fix for houses in multiple occupation and multi-unit blocks, with interest charged at 5.10% and interest coverage ratio calculated at 7.10%. 

The products carry a 5% fee and are available to portfolio landlords at up to 70% loan-to-value.  

It adds that these mortgages are suitable for landlords applying as individuals or through limited company structures in England, Scotland and Wales. 

Paragon Bank commercial director Louisa Sedgwick says: “Our most recent rate reduction sees us quickly respond to the current stability of the swaps market and take 45bps off our core two-year buy-to-let fixed rate, offering our customers some very competitively priced products.  

“These should appeal to borrowers who would like the certainty of a fixed rate product, but over a shorter two-year period. 

Sedgwick adds: “While five-year fixes remain popular, we have seen demand grow for two-year options.  

“This could be driven by more landlords choosing to reassess the market in two years’ time, with the recent easing of inflation increasing confidence that we are nearing the current cycle of base rate rises and the expectation that this will play through to mortgage rates during the period.”