Video: Large-scale landlords see the current market as a chance to expand – West One Loans
Speaking with Specialist Lending Solutions, Andrew Ferguson, managing director – buy-to-let, at West One Loans, said the market had been “remarkably resilient,” throughout the pandemic.
Ferguson said: “We, like most of our competitors and other lenders in the market, are definitely seeing a real demand for buy to let profile this year. That’s a mixture of the pent-up demand that was possibly seen as part of the pandemic, and the stamp duty holiday that has been extended until June.
“We’re definitely seeing the larger-scale landlords that we deal with using it as an opportunity to increase their portfolio.”
He also hinted at remortgage opportunities for brokers, suggesting the maturities market which made up 75 per cent of business last year would continue into 2021.
“We expect a busy time of it and we’re seeing that already this year,” he said.
Identifying areas of business growth, Ferguson said he expected to see opportunities for expansion in limited company, holiday let and expat sectors.
Ferguson also suggested higher-yielding properties, such as homes in multiple occupancy and multi-unit blocks would be desirable to clients.
Watch the first part of the video series [10:59] below, hosted by editor of Mortgage Solutions, Victoria Hartley.
Fleet cuts rates on 75 per cent LTV deals
The rate cuts apply to its five-year fixed deals. Both the standard and limited company products are down by ten basis points, from 3.59 per cent to 3.49 per cent.
Meanwhile five-year fixed rates have been cut on the lender’s Houses in Multiple Occupation (HMO) and Multi Unit Block (MUB) products by 20 basis points from 3.99 per cent to 3.79 per cent.
The standard and HMO/MUB products come with a 1.5 per cent fee while the limited company product has a 1.75 per cent fee.
Steve Cox (pictured), chief commercial officer at Fleet Mortgages, said: “Many landlords are looking to maximise the loans they can achieve and these product cuts to our five-year pay rates will ensure they are even more attractive to borrowers.
“Whatever property type they are seeking to purchase or refinance, and whatever their borrowing needs, these pay rate deals should be of greater interest.”
CHL Mortgages hires former Fleet manager and trio of BDMs
Andy Valvona has stepped into the role of national accounts manager. Valvona’s career in financial services spans more than three decades and among his roles he spent almost three years in the same position at rival specialist lender Fleet Mortgages.
His role will be to introduce and establish the CHL lending proposition in the broker market.
The three BDMs have all previously worked for CHL. They will initially cover England and Wales between them.
Andrea Gizzy will cover London, Midlands and the North, Daniel Watson will cover the South and South West and Paul Flude will cover the South East and East Anglia.
Ross Turrell (pictured), commercial director, CHL Mortgages, said: “When building a new team, it’s vital to get the right people in the right roles. We have taken our time to ensure that we have recruited a team with the appropriate credentials who fully understand the ethos of the company.
“Andy is well known, vastly experienced and highly regarded across the intermediary mortgage market. His experience and connections will ensure that we build key strategic partnerships from the outset and establish CHL Mortgages as a real force within the specialist buy-to-let sector.”
Foundation cuts fees and First 4 Bridging adds new BTL product
The product fees were lowered to 0.75 per cent, down from one per cent, on the F1 two-year fixed rate at 2.99 per cent, and the F2 homes in multiple occupancy (HMO) two-year fixed rate at 3.34 per cent. Both are up to 75 per cent loan to value (LTV).
The fee was cut to one per cent, down from 1.5 per cent, on the F1 five-year fixed at 3.24 per cent, also with LTV up to 75 per cent.
The new sums represent up to 1.25 per cent off Foundation’s standard fees on buy-to-let products.
The range of loan sizes on all three products is £200,000 to £1m.
George Gee, commercial director at Foundation Home Loans, (pictured) said: “Cutting fees provides and ultra-competitive offer to landlord borrowers for purchase or remortgage. We’re acutely aware that landlords want to keep costs as low as possible.”
First 4 Bridging and Castle Trust
First 4 Bridging and Castle Trust Bank have partnered on a buy-to-let product for first-time and portfolio landlords who are purchasing or remortgaging.
The product has a five-year term, with a two-year early repayment charge at 4.5 per cent.
The loan size range is £150,000 to £2m, and the maximum LTV is 75 per cent.
It covers holiday lets, HMOs, portfolio loans and refurbishments.
There is a two per cent arrangement fee.
Donna Wells, director at First 4 Bridging, said: “We are experiencing a huge uplift in activity across all areas of buy to let. Many landlords are looking for lenders with appetite for lending based on unconventional circumstances. As such, Castle Trust has become a great option, and we expect this to be a popular product.”
Rob Oliver, sales director at Castle Trust Bank, added: “This semi-exclusive product lets landlords refinance or sell after two years without penalty.”
Ying Tan to exit Dynamo after Connells Group buyout
Tan (pictured) leaves Dynamo after 15 years, during which he guided the business to a plethora of industry awards.
Tan said his mission when setting the business up was “to be respected by the clients and the marketplace as one of the leading mortgage intermediaries in the UK.” He feels this has certainly been achieved with his relentless drive for excellence.
He said: “Every entrepreneur dreams of starting, building, successfully scaling and exiting a business when the time is right; and this certainly represents the right time for me.”
“It’s been an amazing journey, having started from a tiny office in Guildford with no windows to operating out of a 13,000 sq ft office which has capacity for up to 200 people. Last month was a record revenue month for the business in our 15 year history. The Dynamo rebrand took us to a whole new level and the company is in a fantastic position to continue moving forward, at pace. It has a great new owner in Connells Group who has a proven track record with companies they have acquired and there are significant synergies which Dynamo will greatly benefit from.”
Tan said: “From a personal perspective this was too good an opportunity to turn down. It feels fantastic to leave the company in a strong position with records being broken and poised for continued growth having recruited aggressively since the beginning of the year. No one person is bigger than the business and I’m sure that it will continue to be a huge force in the intermediary market for many years to come. I’d like to thank everyone for their support over the years, the amazing staff and particularly my leadership team who have provided the backbone to the immense success of this wonderful business.”
Adrian Scott, Connells Group mortgage services director, said: “Dynamo has built an impressive reputation across the intermediary market and Ying has been the driving force behind this. He leaves the company operating at the top of its game and we are delighted to have been able to acquire it on the back of company records and with such a strong infrastructure in place for continued growth. The company is a great fit for Connells Group and I look forward to working with the strong Dynamo management team.
“I’d also like to take this opportunity to wish Ying well in his future endeavours and I’m sure he will continue to achieve phenomenal success in whatever he chooses to do next,” Scott added.
Leeds Building Society raises LTV for buy-to-let deals
From Thursday, private landlords can choose from a 2.14 per cent two-year fixed rate buy-to-let mortgage and a five-year equivalent priced at 2.44 per cent. Both deals have a £999 product fee.
At the same time, the society has raised the LTV on holiday lets to 75 per cent for the first time.
The holiday let deal is a five-year fixed rate mortgage priced at 4.24 per cent and has no product fee.
Leeds BS is also improving its minimum income requirements for holiday lets and will now accept joint applicants with a total income of £60,000 where one applicant alone earns less than £40,000.
The society is also increasing available LTVs on new-build homes in both sectors from 65 per cent to 70 per cent on new-build houses and from 60 per cent to 65 per cent on new-build flats.
Matt Bartle, director of products at Leeds Building Society, said: “Understanding borrower needs and developing products and lending criteria to support our customers is key to who we are as a mutual.
“While interest in holiday lest has continued to build over recent years, we expect this demand to remain strong as more people choose staycations because of the restrictions or complexities around international travel due to the pandemic.”
Precise Mortgages relaunches top slicing for buy to let
The feature is available across the lender’s entire buy–to–let range including individual, limited company, portfolio and homes in multiple occupancy (HMO) products.
It is not available to first-time buyers and applicants who are receiving furlough income or Self-Employment Income Support Scheme (SEISS) payments.
A calculator is also available to help brokers identify how much surplus portfolio or earned income is required to achieve a requested loan size in the case of a shortfall.
Rental income must meet a minimum of 110 per cent interest cover ratio (ICR) of the pay rate of a product for the property to be eligible. Surplus income can then be used to prove the borrower can make up any shortfall against the standard ICR.
Customers can switch to top slicing after they have applied for a mortgage without resubmitting, in case further options are needed due to down valuations.
Adrian Moloney, group sales director at Precise Mortgages, said: “The relaunch of our popular top slicing feature demonstrates how committed we are to supporting the market and our broker partners.
“Top slicing allows landlords greater choice in the way they manage their properties and could help them to optimise their investment opportunities. We’re reintroducing a wider choice of products by unlocking access to our two-year fixed rate, as well as our five-year fixed rate mortgage products.
“These products could be particularly useful for those who may have been restricted from investment opportunities, as well as helping landlords achieve greater flexibility around loan size.”
Know Your BDM: David Wheatley, Foundation Home Loans
What locations and how many advisers and broker firms do you cover in your role?
I look after the London postcodes EC and WC which encompasses around 522 brokers at the moment.
How have you changed the way you establish and maintain a good relationship with brokers in the pandemic?
We have adapted with the restrictions in place and have used various video conferencing platforms to meet with our brokers which is allowing a greater turnout.
This coupled with years of experience building relationships over the phones within our internal team has taught me many of the skills I am still able to utilise.
What personal talent/skill is most valuable in doing your job?
Without doubt, being organised.
I think being able to know which cases take priority for brokers allows me to focus on getting the correct results when needed.
This coupled with prioritising policy or product updates to brokers who will be able to benefit means we can be more efficient with their time.
What personal talent/skill would you most like to improve on?
My patience. I like things to do be done quickly and efficiently and need to remember that service level agreements appear in most organisations.
Where would you rather be stuck, in bumper-to-bumper traffic or back-to-back Zoom calls?
Back-to-back Zoom calls as usually the content is engaging.
What’s the best bit of career-related advice you’ve ever been given?
Years ago, I was told there is no such thing as luck and that everything happens due to the work that is put into any situation.
What is the most quirky/unique property deal you’ve been involved in?
To date, it’s been an incorporation of 22 properties that completed on the same day.
What has been your lockdown coping strategy?
I have two small children who are a very good distraction. Lockdown has meant I’ve been able spend invaluable time with them that may have been more difficult otherwise. This coupled with regular exercise.
If you were head of the FCA for the day, what would you change about regulation in the mortgage industry?
Very good question – I would speak to the people across the industry to see what the most significant obstacles to trade would be and try to work a way around this while ensuring people were protected.
What was your motivation for choosing business development as a career?
While working for a mainstream lender I looked at becoming an underwriter, however the role I originally looked at was no longer available.
Business development was an option that was offered which I was unaware existed due to prior ignorance. I think it encompasses a wide range of skills and I love the sales buzz you get from seeing an enquiry go to completion.
If you could do any other job in the property sector, what would it be and why?
I would love to have my own portfolio of properties and be able to watch everything develop. But in all honesty I would still carry on as BDM as I love the role.
What did you want to be growing up?
Growing up I wanted to be a public servant – either a police officer or in the military.
What’s your favourite face mask design/pattern to wear?
I have a bright yellow face mask which is both my favourite colour and coincidentally matches Foundation Home Loans’ branding.
And finally, what’s the strangest question you’ve ever been asked?
There have been numerous strange questions but none jump to mind.
Broker business opportunities still present in the resilient BTL sector – Simpson
Although a number of lenders temporarily withdrew from the market during the first lockdown and visual inspections ground to a halt, the market has recovered well.
The total amount of buy-to-let lending annually has been around £36bn for the last couple of years and we may see growth up to £40bn in 2021.
There is certainly a strong appetite from lenders in the buy-to-let space providing a wide range of products for landlords to choose from.
This has created healthy competition in the marketplace and the historically low Bank of England base rate has meant some very attractive rates are currently available.
Buy-to-let investors have a diverse range of finance needs and lending policies in the marketplace differ widely, with no two providers taking exactly the same approach to risk and criteria requirements.
For complex buy-to-let cases such as for homes in multiple occupancy (HMOs), limited companies, large portfolios or semi-commercial properties, landlord clients may find that they need to choose a specialist lender such as Paragon, Foundation Home Loans or Interbay.
There is no shortage of choice for complex cases and brokers should be able to find solutions for almost all scenarios.
However, the buy-to-let mortgage market is very dynamic, and a high level of expertise and technical knowledge is often required to place these cases successfully and keep on top of all the options available.
The demand for limited company finance is still strong which is unsurprising as the mortgage interest tax relief for buy-to-let was finally phased out completely in April 2020.
Landlords may benefit from tax advantages by using a corporate structure and high demand for limited company products is likely to continue in 2021.
A recent report by Hamptons claimed that around half of all buy-to-let properties are held in a limited company.
The holiday let sector has seen an unexpected boost in demand for properties with popular resorts and other attractive locations as a growing number of people have opted for UK staycations during the pandemic.
At TBMC we have seen a significant uplift in holiday-let enquiries and several lenders have widened their propositions to cater for this niche area of the buy-to-let market.
However, product options are still limited, and the sector may benefit from greater competition, especially as demand for UK holidays is likely to continue throughout 2021 and perhaps further into the future as people discover what Britain has to offer.
The buy-to-let mortgage market is still buoyant and there is reason to be optimistic about writing buy-to-let mortgage business in 2021.
Vida launches buy to let deal at 80 per cent LTV
It will be available on both a purchase and remortgage basis with a fixed fee of £3,750 and a maximum loan size of £750,000. In addition, it will provide a free valuation for all properties up to the value of £1m.
The product is priced at 4.34 per cent for its core buy-to-let borrowers and 4.74 per cent for landlords with housing in multiple occupation (HMO) and multi-unit block (MUB) properties.
In addition, Vida has discounted its 70 per cent LTV rate by 10 basis points (bps) and reduced a two-year fixed 75 per cent LTV product by 15bps.
It has also cut initial rates for expat borrowers by up to 30bps and reduced the product fee to 1.5 per cent with a minimum £795 fee.
Richard Tugwell, director of mortgage distribution at Vida, said: “Covid-19 has impacted the financial circumstances of millions of people across the UK, and landlords are no exception.
“Many have experienced issues with rental yield or are investing in more specialist property types, so they will need the support of expert lenders like Vida who can help them despite their more complex requirements.
“We’re confident that our fixed fee special is an ideal solution for landlords with several HMOs or MUBs, looking for greater choice and flexibility for larger loan sizes up to 80 per cent LTV.”