Shawbrook ups cover rates on HMOs and Masthaven widens AVM limits

  • 05/05/2020
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Shawbrook ups cover rates on HMOs and Masthaven widens AVM limits
Shawbrook is increasing its debt service cover ratios (DSCR) on houses in multiple occupation (HMO) applications.


In a communication sent to brokers, the lender said it was doing so as a temporary measure in response to the changing environment.

Cases submitted up to 1 May will be honoured on the previous conditions, it noted.

The pay rate on five-year fixes or longer that have more than a ten-year term is increasing from 175 per cent to 195 per cent on personal applications, and from 150 per cent to 165 per cent on limited companies.

The stress rate, which applies to all variable term loans up to 30 years and all fixed rates up to year total term, is going up to 180 per cent for personal applications and to 165 per cent for limited companies.

Shawbrook Bank head of sales Gavin Seaholme told Specialist Lending Solutions: “Shawbrook have made this temporary move to support sustainability through these difficult times, across an inherently complex asset class.

“Ultimately, a good customer outcome sits at the heart of our decision making and we feel this is the right thing to do to ensure the customer is protected in the long term, and to ensure we as a business retain a strong offering in support of HMO investors.”




Masthaven ups AVMs

Meanwhile, Masthaven is increasing the scope of its automated valuations.

A communication to brokers from the lender said for the first time it was introducing AVMs for first charge residential purchases, buy-to-let remortgages and buy-to-let purchases.

It is also increasing the maximum AVM loan levels for residential remortgages and residential second charges.

Maximum loan-to-values will be 65 per cent using AVMs, with maximum loan values for residential purchases and remortgage at £350,000 for confidence level six, and £250,000 for confidence level five.

The same conditions apply for buy-to-let purchases and remortgages.

For second charges, loans up to £150,000 or 65 per cent LTV will require confidence level six, with up to 60 per cent LTV needing confidence level five.

Last week, Masthaven launched a fee-free product range for residential remortgages.


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