The monthly magazine providing news analysis and professional research for the discerning private investor/landlord

Mortgage and Finance Matters

Simon Allen, of Searchlight Finance, comments on recent changes in the marketplace

CP11/16 - You are going to hear a lot about this directly or indirectly over the next few months. It's not an unheard of extra in the cast from the latest Star Wars movie but a report from the Bank of England (BoE) into underwriting standards for Buy to Let Mortgages.

It's at the consultation stage which finishes on the 29th June 2016 and lenders expect it to be implemented. It's a set of minimum standards for BTL caused by concerns within the BoE over underwriting standards and inappropriate lending from some of the BTL lenders.

It will cover affordability, stress testing of interest rates, a definition of a portfolio landlord and lender's internal systems. One important point is that it shouldn't cover re-mortgaging if no additional funds are needed.

It covers both personal and limited company applications so this has kept lenders busy with very few interesting product updates over the last quarter. It will affect some lenders more than others as most lenders have a thorough underwriting process and higher rental calculations. News of these alterations will be in my regular mortgage market updates and if you want a copy then email me and I will send you one.

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