A buy-to-let expert says new landlords should be given advice about what they are letting themselves in for when they apply for mortgages.
David Lawrenson, author of the best selling book ‘Successful Property Letting’, said that helping landlords to understand their responsibilities could also reduce lenders’ risk of future arrears.
Lawrenson said: “While lenders now require a lot of information about buy-to-let borrowers before they will lend, they still don’t require their borrowers to actually know much about the business of actually being a landlord, which is far more complex today than it was when buy-to-let mortgages were born in 1996.
“Most landlords taking out a buy-to-let mortgage loan today are still given very little (or no) guidance at all from a mortgage company about how to make a success of the now very complex business of letting a property successfully and meeting their legal responsibilities as landlords.
“Landlords’ real sources of advice are actually very limited.”
Buy-to-let mortgages are unregulated by the FSA on the grounds that it regards them as business transactions where the borrower should be fully aware of what they are doing.
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