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More landlords likely to use specialist lenders due to new changes - Together

As the buy-to-let industry braces itself for yet more changes, a growing number of private landlords are likely to turn to specialist mortgage lenders for finance, according to Together, which offers short-term finance, auction finance, commercial and buy-to-let mortgages.

From the end of next week, lenders will have to take a more stringent approach to buy-to-let mortgage applications from portfolio landlords who own four or more mortgaged properties, which will leave many investors seeking funds elsewhere.

Together, which confirmed its continued support for buy-to-let portfolio landlords ahead of the Prudential Regulation Authority’s (PRA) underwriting changes, which will be implemented from 30 September, yesterday revealed its changes for buy-to-let portfolio landlords


The specialist lender issued guidance on its new process for buy-to-let portfolio landlords - those with four or more properties - who are subject to the new PRA regulations.

From September 29, the loan-to-value (LTV) across a customer’s portfolio must not exceed 75%, including mortgage-free properties.

Together will apply an overall portfolio interest coverage ratio (ICR) for customers who have had arrears on any mortgage or secured loan in the last 12 months, and will require proof of income, although if there are no secured arrears then this will not be applied.

The lender has updated its property schedule document to capture whether properties are tenanted and the repayment type of existing mortgages. There will also be two additional questions on Together’s broker portal, My Broker Venue (MBV) to find out how many mortgaged buy-to-let properties the customer currently owns and the length of time the customer has been a landlord.

Richard Tugwell, intermediary relationship director at Together, commented: “As the buy-to-let sector prepares for further changes, it’s likely that we’ll see a move towards specialist lenders like ourselves that can offer the flexibility and personal approach that will be needed in many portfolio landlord cases.  At Together, we have updated our processes to help make it as easy as possible for brokers to adapt to the changes and applied our usual common sense approach.

“Earlier this year, we enhanced our buy-to-let product range and we’ll be continuing to review both our products and processes as the changes come into effect. We have a specialist buy-to-let team responsible for underwriting these applications and our roving underwriters and business development managers will provide any additional support that brokers may require.”

All new buy-to-let portfolio landlord applications to Together will be processed in line with new criteria from September 29 and the lender’s online portal, My Broker Venue, has been updated to ensure a swift and smooth application.

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