The number of mortgage lenders still offering products to landlords is 42 - only seven fewer than at the peak of the so-called Boris Bounce early in the year.
There was recent publicity when HSBC announced it would no longer accept buy to let investors as customers but Mortgage for Business, a specialist mortgage broker, says the large majority of lenders are still working with the private rental sector.
Indeed, four of the lenders that initially withdrew their BTL mortgages – Santander, Clydesdale, Precise Mortgages, and Kent Reliance – are now lending again.
And the Saffron Building Society, which withdrew from the market before the outbreak in March – for non covid-19 reasons – has indicated its intention to return to market later in the year.
Lenders that stopped lending to landlords since the outbreak and remain withdrawn from the BTL market as of today include HSBC; Foundation Home Loans; Together Money; Vida Home Loans; Platform Home Loans; State Bank of India; and Furness Building Society.
“With valuers banned from visiting homes, landlords are finding remortgaging harder than it was. But there are lenders offering mortgages using automated valuations, rather than physical valuations, and a lot of our landlord clients are taking advantage of this” explains Steve Olejnik, managing director of Mortgages for Business.
“Even lenders who require a physical valuation at a higher Loan To Value (PTV) are generally processing landlords’ remortgage applications as normal – but moving the valuation part of the application to the very end. A significant percentage of our landlord clients are happy to do this. They’re content to sit back and wait out the lockdown and get a physical valuation done.”
He adds: “The number of products has dropped but the only section of the market that’s genuinely gummed up is 85 per cent LTV lending – and that’s pretty niche. There were only three lenders doing business at that end of the market when the Boris Bounce was in full swing.
“Even lenders who require a physical valuation at a higher LTV are generally processing landlords’ remortgage applications as normal – but moving the valuation part of the application to the very end. A significant percentage of our landlord clients are happy to do this. They’re content to sit back and wait out the lockdown and get a physical valuation done.”
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It'll be very disappointing when the valuation comes through 'right at the end' if valuers assess the crisis as devaluing property and I can't think of an economic crisis that didn't result in property value drop of significant proportions. It will be lovely to think the property values will not be affected negatively by this crisis but with huge unemployment, debt, government debt and tenant arrears can we feel any confidence? Happy news anyone please?
Sorry. I should be happy to cheer you up Dale.
However it will be experienced that banks/investrors are never kind in these sort of times.
History is full of examples.
There will be mass repossessions.
BTL lenders are too stupid to offer forbearance
Two missed payments and they will repossess.
The 3 month mortgage deferment is just putting off lender repossession.
There will be many bankrupted LL.
Of course what any sensible BTL lender would do is to suspend normal lender repossession criteria in what are unique times.
Trouble is there are no sensible BTL lenders.
Once normality occurs LL would invariably be able to catch up over months of any missed mortgage payments.
Though this won't come from rent defaulting tenants who will never repay their defaulted rent.
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