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BTL deal maturities to soar to £13bn in H1 2018 boom – exclusive

  • 05/12/2017
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BTL deal maturities to soar to £13bn in H1 2018 boom – exclusive
Brokers are being told to prepare for a surge in buy-to-let (BTL) mortgage maturities in the first half of 2018.

With some lenders in the sector not having retention propositions there could be even greater cause for broker activity.

According to CACI data seen by Mortgage Solutions, more than £13bn worth of BTL mortgages are set to mature in the first six months of next year.

A further £11.4bn of maturities in the second half of the year means a total £24.4bn of BTL loans are due to mature in 2018.

This is largely due to the spike in landlord purchase activity in early 2016 before the introduction of the stamp duty surcharge for additional home purchases.


Plenty of opportunities

Dale Jannels, managing director of All Types of Mortgages (AToM), said he was not surprised by these figures for that reason and urged brokers to be pro-active.

“Some lenders don’t have retention propositions so there will be plenty of opportunities for brokers to gain business in 2018,” he said.

“In addition, and following the recent tax changes, landlords will be reviewing their options and specialists in the BTL sector will be sought to assist.

“I think 2018 will be good for those who specialise in the BTL sector and especially those packagers, like AToM, who have access to the specialist BTL lenders and exclusive products,” he added.

TMA mortgage club senior product and business manager Rob McCoy noted it was a tremendous opportunity for brokers as most of those sales would have been advised on originally.

“They should be thinking about this now,” he said.

“There will be maturities from people who rushed in to get that second property and they were probably put on two-year deals as they were the cheapest at the time, but the market’s moved now and everyone is looking for longer term security such as some of the five-year deals.”

He added that given the changes in the sector over the last 18 months borrowers may not be prepared for the new environment and may need specialist tax advice.


Overall client needs

This was echoed by Connect for Intermediaries CEO Liz Syms, who suggested it would be a good time for brokers examine their clients’ overall needs, particularly with the changes that have occurred.

“At the stamp duty surcharge point we didn’t have things like the portfolio lending changes, so clients coming to the end of their deals who are looking to capital raise, for example, may not even qualify for the same lender anymore,” she said.

“Landlords who may previously have done a standard switch or remortgage directly with a lender may now need more advice because of the other changes that have happened.

“They may have to stay on the standard variable rate, because the market has changed – particularly underwriting standards and rental calculations,” she added.

Foundation Home Loans marketing director Jeff Knight noted: “While purchase buy to let activity has decreased over the last 18 months, it is refreshing to see some news that highlights that opportunities do actually still exist for brokers in 2018.

“The key is to make sure they are capitalised upon by making proactive contact with clients, before someone else does.”

He added that the situation may prove particularly attractive to specialist lenders, particularly those looking for portfolio landlord clients.


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