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New Street to offer superior rental calcs for London and South East

  • 05/02/2016
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New Street to offer superior rental calcs for London and South East
New Street Mortgages will offer preferential rental calculations to buy-to-let landlords purchasing property in London and the South East, it has announced alongside its market launch today.

New Street will set rental calculations at 115% of a notional rate of 5% in London and 120% of 5% in the South East, both with a reversionary rate of 4.29%. The calculation for rental income across the rest of the UK will be set at 125% of 5%.

The intermediary-only lender, which is headed up by ex-Barclay’s David Finlay, will also allow brokers to instruct the valuation of a property rather than through the lender.

Adrian Whittaker, sales and distribution director at New Street Mortgages (pictured), said: “In London and the South East we see a higher quality landlord property market, and more importantly more demand and lower voids. As a result we are able to offer differential rental calculations based on the lower level of risk to us as a lender.”

Additional features for buy-to-let investors in other areas of the UK will also be available, including discounted rates for borrowers with incomes over £100,000 and landlords with high-yielding properties.

New Street, which launches today, will use an analytics-driven approach to its lending rather than a standard credit score, allowing it to offer more targeted products to meet the needs of individual customer requirements.

Through its advance and geo-advance range, it will analyse market sector risk and borrower profiles in order to produce better rates and terms for customers.

Whittaker said by using this approach the lender would be able to produce a mortgage offer in as little as five days.

“Our aspiration is to effectively produce offers in half the time to that of the average UK lender,” he said.

According to Whittaker, New Street does not currently have any direct competitors in the market that rival its technology and service offering.

“We don’t believe we’ve got any real competitors in that sense, but the only time that we will is if we get any copycats,” he said.

New Street is offering a limited buy-to-let product range initially before launching into the mainstream market later in the year. It is making its deals available to brokers with London & Country, John Charcol and the LSL mortgage networks, Pink and First Complete. It intends to roll out distribution fully by the end of 2016 and is offering brokers a procuration fee of 0.5% on buy-to-let deals.

“Like anything we need to make sure that the service we offer is absolutely right, so as a result we’re going to launch with a limited product range and limited distribution,” Whittaker said.

The lender has also expressed an interest in lending solutions for individuals borrowing into retirement.

Whittaker said New Street would ‘love to address’ the issues surrounding lending into retirement but would not be drawn on specific details.

“We’re continually looking at ways we can develop products for those that are underserved in the UK mortgage market,” he added.

New Street Mortgages is part of The North View Group, the brand which covers Kensington Mortgages and mortgage servicing provider Acenden.

Whittaker said New Street will not detract from Kensington’s focus in the complex lending arena but instead focus on offering ‘smarter mortgage solutions’ for the mainstream market.

He added that The North View Group has ambitions to achieve 1% market share of the UK mortgage market but could not provide more information on a timescale for this.

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