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Leeds extends max portfolio size to 10 and confirms post-PRA lending stance

  • 07/08/2017
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Leeds extends max portfolio size to 10 and confirms post-PRA lending stance
Leeds Building Society has extended its portfolio lending cap from eight to ten mortgaged rental properties and increased holiday lets to four ahead of the Prudential Regulation Authority (PRA) rules change next month.

The mutual said this provided intermediaries with greater flexibility to mix and match, using the Leeds for up to four properties including a mix of buy to let or holiday let.

Jaedon Green, Leeds Building Society’s director of product and distribution said: “We’re committed to supporting landlords and the buy-to-let market so will continue to accept mortgage applications from portfolio landlords after 30 September.”

There are no changes to our existing loan to value (LTV) limits, maximum loan size, Interest Coverage Ratio (ICR) or stress rates.

In January, the society adjusted its buy-to-let criteria by increasing ICR from 125% to 140% and assessing ICR taking into account mortgage interest tax relief.

It also confirmed an affordability stress rate for purchase and capital raising remortgages of 5.50% and a 5% affordability stress rate on loans with no extra borrowing. Also, existing borrowers with no additional borrowing will not require an ICR assessment.

The society also removed the minimum income requirement of £25,000 for single or £40,000 for joint applicants and it continues to lend up to 70% LTV.


Portfolio details

In addition to the property schedule already requested for applications on or after 29 September, portfolio landlords will need to provide details of their assets and liabilities, and declare future investment property intentions.

Further information, such as cash flow, will be requested only in more complex cases, which the society expects will account for a very small proportion of applications.

“The buy to let criteria changes we introduced at the start of this year were well-received by the industry,” said Green.

“To further develop our proposition we’re preparing our underwriting and broker-facing colleagues to ensure that at launch we‘re able to fully support our intermediary partners,” he added.

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