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Graham Awards


Mortgage borrowing now tougher for portfolio buy to let investors

Nearly three quarters of portfolio landlords have found it more difficult to secure a mortgage since the Prudential Regulation Authority’s changes were introduced last year.

This is the key finding from research for Foundation Home Loans by BDRC Continental.

When asked how they had been affected by the PRA regulatory changes, 70 per cent of UK landlords with over four buy to let mortgages said they had found obtaining finance a challenge since the regulation came into effect on September 30. 


Some 51 per cent owning between one and three buy to let mortgages felt the same.

The PRA changes mean lenders have changed the way in which buy to let mortgage applications are underwritten for portfolio landlords. 

Borrowers with four or more mortgaged properties will be classified as portfolio landlords and subject to the new standards, such as a requirement to submit a forward-looking business plan. 

As a result almost half of landlords aware of the PRA changes think they  will slow down the process of securing a mortgage, with two thirds of those who own 11 or more properties believing the range of mortgage products available to them will be reduced. 

As many as 28 per cent believe the changes will make it more likely for their mortgage application to be rejected.

“Whether these figures are to do with a natural period of adjustment or become the new norm remains to be seen” says Jeff Knight, Foundation’s marketing director.


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