John Eastgate (pictured), sales and marketing director at parent One Savings Bank, said that regulatory changes were driving a more professional buy-to-let market, with limited company lending becoming more prevalent.
He continued: “As a specialist lender with a long track record of targeting the professional landlord, including those borrowing through limited companies, we have experienced a period of very strong demand. This has caused some temporary service delays, which we have already communicated to brokers, and we apologise sincerely for this.”
He added that currently the lender is turning cases around in 17 days, though he pointed out that brokers who package cases well, with all the required documentation, are likely to receive prompt offers.
“However, we are also implementing a range of measures to improve processing times, and we expect these to deliver improved outcomes in the next few weeks,” he concluded.
Last month, OneSavings Bank said that the proportion of limited company buy-to-let applications to Kent Reliance had jumped from 40% of all applications in December 2015 to 57% in the second half of 2016.
David Whittaker, chief executive officer of Mortgages for Business, said that the upsurge in limited company buy-to-let interest meant that all of the major specialist buy-to-let lenders had “felt the pressure” at various times since the start of 2017, and noted that the ripple down effect to smaller lenders had been less visible and therefore less obvious to the market.
He noted that Kent had broadened its distribution strategy last year, and had developed a process that was well understood by brokers, adding: “The Easter holidays are now upon us so the new business pressure should ease on the processing teams. Kent Reliance is well known for putting in extra time to get on top of service issues, so brokers will be looking for them to be back within SLA after the Easter break.
Chris Lloyd, associate director at Enness Private Clients, said that it was understandable that Kent had been swamped with so many applications, as the firm’s buy-to-let offering – including its stress-testing – stands out from the competition.
He said: “We use them so much. Lots of people are now doing their buy-to-let through limited companies, and Kent’s products are so cheap. With other lenders getting so strict with their criteria, it has made Kent one of the only lenders that it’s possible to get a deal with in London, because of the rental yields. But these delays will cause significant issues for our clients.”