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NEW! Reduced validation requirements for 5 year plus fixed rate buy to let mortgages


Steve - Senior Underwriter

Published 22.06.2021

Cast your minds back to the start of January 2017. I don't know if you remember, but the country was shivering in freezing temperatures and thick fog, Donald Trump was just about to be sworn in as the 45th president of the United States of America and lenders were still getting to grips with the PRA's changes to buy to let lending.

Among the first raft of changes the PRA introduced were stricter affordability tests, including a stress test on interest rate rises, for landlords, with lenders encouraged to look at customers' wider financial situations, not just the potential rental income when assessing their application.

As a PRA-regulated lender, we decided to introduce additional checks for customers applying for one of our 5+ year fixed rate buy to let mortgages with an LTV greater than 60%, and whose rental income didn't meet stressed rate requirements. We did this to ensure customers were in a position to manage any potential payment changes at the end of their product term.

After more than four years, however, I'm delighted to announce that we've taken the opportunity to harmonise the way we underwrite our fixed rate products and no longer need to obtain this additional validation.

This means we no longer need to see evidence demonstrating that customers have:

  • Substantial net worth; or
  • Satisfactory level of liquid assets; or
  • Excess disposable income

This is great news for you and your customers. Not only could it make it easier for landlords to secure the buy to let mortgage they need, it could also make it quicker for you to place their cases, freeing up your time so you can concentrate on doing what you do best – helping as many people as possible.

If you'd like to find out more, take a look at our buy to let product guide, speak with a member of our sales team or call our dedicated support service on 0800 116 4385.

The products and/or services featured in this communication are not regulated by the Financial Conduct Authority and the Prudential Regulation Authority.


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