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PRA changes drive ‘interesting developments’ in BTL market – Ying Tan

by: Ying Tan, managing director of Buy to Let Club
  • 10/10/2017
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PRA changes drive ‘interesting developments’ in BTL market – Ying Tan
With the Prudential Regulation Authority changes introduced we have finally seen those lenders who were late to announce their approach to portfolio landlords finally laying their cards on the table.

Barclays’ new approach came into play on September 19 and saw some tweaks to the lender’s previous stance.

The lender already assesses buy-to-let affordability by undertaking a personal solvency review and detailed affordability assessment of the borrower.

From now on clients will be allowed a maximum of six mortgaged buy-to-let or permission-to-let (PTL) properties with the lender and a maximum of 10 mortgaged buy-to-let/PTL properties across all lenders. All portfolio landlord clients will need to complete a property schedule.

Meanwhile, Clydesdale Bank says its approach will be to continue to assist portfolio landlords if they are remortgaging and not borrowing any additional money.

However, for customers looking to borrow additional money or purchase a new buy-to-let it will only be able to assist if the customer does not meet the definition of a portfolio landlord.


Interesting developments

Portfolio lending changes aside, there were some interesting developments across the market.

Foundation Home Loans announced it was removing its £500 processing fee for limited company buy-to-let applications, no doubt good news for those landlords looking to the limited company route to avoid tax relief cuts.

Elsewhere, Vida announced it was reintroducing its limited edition range, offering its lowest ever rates of 3.14% for buy-to-let business. The limited edition range includes products on two- and five-year fixed-rates and is available up to 70% loan-to-value (LTV).

Finally, The Mortgage Works launched a new product range with 50% tiered products. The new two- and five-year fixed-rates at 50% LTV for remortgage feature rates of 1.39% and 2.14% respectively. Both products have a £1,995 arrangement fee and come with a free standard valuation and free standard legals.


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