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First Complete buys minority stake in digital BTL broker startup

by: Tim Chen
  • 12/10/2017
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First Complete buys minority stake in digital BTL broker startup
LSL Property Services-owned network, First Complete, has bought a minority investment in a digital buy-to-let mortgage broker and technology company, Property Master.

Start-up Property Master said it uses “sophisticated algorithms” to match landlords and products by keeping a live database of mortgage product information and lending criteria, which is supplied by Market Monitoring, a company which for the last ten years has been running a live database of mortgages to lenders.

“What Proper Master allows landlords to do is enter details about themselves and their properties, and we perform a live search against the entire UK buy-to-let property markets,” said Chris Little, marketing director at Property Master. 

“And as the landlord gets further into our product, they’re entering data that allows us to match the lending criteria as well as product criteria,” Little added.

If the landlord wants to progress with the mortgage or purchase, they press apply and it populates the lender’s form. Property Master is then ready to submit on the landlord’s behalf to the lender

This investment comes as the buy-to-let sector is bedding into a host of Prudential Regulation Authority (PRA) changes on September 30, introducing stress tests to see if a borrower can afford repayments if interest rates were to hit 5.5%, and requiring lenders to check the metrics on a landlord’s entire property portfolio before approving a buy-to-let mortgage.

Property Master said it can navigate the complex regulatory requirements by using a database of generic PRA requirements as well as lenders’ specific affordability criteria.

“All it takes is fifteen minutes, and all the landlord needs to do is click and we filter their exact circumstances against lender’s and the PRA’s affordability rules,” says Little.

Although aimed at professional landlords, Proper Master has fully regulated brokers in-house so they can process prospective consumer landlords as well.

“It’s a pre-approved mortgage, in the sense that we have matched the information landlords provide exactly with what lenders require — it’s exactly what a broker would be doing except we are able to do it live across the whole market.”

Property Master says that over 7,000 landlords have made use of its services since launch. And Angus Stewart, chief executive of Property Master, said the firm has facilitated over 14,000 mortgage searches in the last four months.

The tool allows landlords to play with a portfolio, to restructure the funding on their properties and see how that impacts the tapered reduction in mortgage interest tax relief coming next year on buy to lets.

“Because we provide an online tool, you can play out scenarios as well. By varying LTV, for instance, or switching property holdings into a limited company. As a landlord, you might want to know in advance how company switching or different scenarios will impact fund raising ability.”

David Copland, director of mortgage services at LSL Property Services said that they “recognise the structural changes occurring within the mortgage industry and see Property Master’s technology as a key enabler of future change.”

Going forward, Stewart said that Property Master will use the investment to “help accelerate the growth and capability of Property Master and assist in providing more choice to landlords in the buy-to-let mortgage market.”

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