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    Thanks LA, that makes it very clear that the third BTL property will be the last than can be stressed at 125%. This confirms my thought that in order to maximise leverage I will need to make it a higher value property that I raise funds for, as things stand.

    Also if I want to buy for cash only cheaper up north, it would be idiotic to do this first.


      As they say "Watch this space" Summer is going to be busy all round.


        Don't get too excited BUT !

        From a brokers perspective it appears that a degree of concern is being expressed by certain lenders regarding the level of BtL business which is being generated.

        First there were the calls from lenders enquiring if they could help with any enquiries and now we find lenders offering "Special Offers" whereby loans will be considered on products under 5 year incentive periods but using stress calculations of 125% @ 5%. Without being too cynical I suspect that with the imminent arrival of school hols and summer breaks lenders may be wanting to get additional business before the new PRA rules kick in on October 1st..

        Times they are a changing !!


          Aldermore reveal their stance on the changes under the PRA

          Aldermore will therefore split portfolio landlords into two categories to determine what further information needs to be provided to underwrite the individual case.

          Where the applicant up to 10 mortgaged buy-to-let properties with Aldermore, a portfolio schedule and business plan will be required.

          Where the applicant has 11 or more mortgaged buy-to-let properties, an additional 12 month cash flow forecast statement and statement of assets and liabilities will be required, along with a face to face interview.

          Other checks will include portfolio affordability testing, rental income validation by postcode, and where personal income is used, assessment of living costs and essential expenditure


            Thanks for the update loanarranger but you missed an important bit;

            Where the applicant has 11 or more mortgaged buy-to-let properties.....with Aldermore
            When I first read your post, I thought sod that, I won't be using Aldermore!
            But after reading, the changes really aren't too onerous.
            They are even providing templates;


            "Standardised templates will be available for each of the information requirements."


              Yes I apologise for omitting the second part.
              Aldermore are amongst my preferred lenders, I have a great BDM who gives me great support as and when I need it not least the case I mentioned including Japanese Knotweed, with perseverance and cooperation they came through with what my clients wanted.
              best wishes


                Platform Homeloans have announced the following in light of the PRA changes which are shortly to come into effect.

                "From Monday 28th August Platform won't lend to individuals with four or more B2L properties (mortgaged or un-mortgaged).

                Now that I am back from hols I will scour the numerous emails to enable me to let forum readers know of any further significant changes to lending criteria etc.


                  Please note that from 11th September TSB are for the present not accepting BtL applications from any individual who currently owns more than 3 BtL properties. They concede that they have no infrastructure in place at present to handle underwriting processes for portfolio applicants taking account of the changes by the PRA.


                    When do the PRA rules kick in? If I apply and get an agreement in principle now but exchange after end of September am I still liable under the new rules?

                    I'm looking to apply via Barclays. Anyone know if they're up on PRA rules or will they reject applicants as per TSB.


                      The official date for implementation is October 1st , however a number of lenders involved in portfolio lending have either jumped the gun or have oven a date in September when new applications will be subject to the new criteria.

                      in light of your question and to accurately state the position I would need to know who the lender is.


                        Originally posted by loanarranger View Post
                        The official date for implementation is October 1st , however a number of lenders involved in portfolio lending have either jumped the gun or have oven a date in September when new applications will be subject to the new criteria.

                        in light of your question and to accurately state the position I would need to know who the lender is.
                        The lender is Barclays


                          There are no specific announcements in the context under which we are corresponding but they have created a detailed calculator which takes account of stress testing including for residential mortgages the Higher of Outstanding Balance @ 6.74% on IO Basis OR Mortgage Repayment + 3% on IO Basis , Existing BTL MortgageCosts:Aggregated Balance @ 5.5% on Interest Only Basis , Applied for BTL Mortgage Costs: Loan Amount @ 5.5% on Interest Only Basis : after all these they then take account of all other financial commitments including secured and unsecured debts and the costs of renting all properties.

                          Barclays take the view that this "Affordability Matrix" negates the view of applying different criteria to those with a maximum of three properties to those who fall under the guidelines of 4 or more and that would include the proposed new acquisition.

                          Please note that Barclays will NOT lend where the applicant has more than six mortgaged properties as BtL.



                            Research from Foundation HomeLoans indicate a possible shift in Landlord sentiment reflecting the changes which are about to possibly impact the market.

                            Landlords are reacting to the ongoing buy-to-let uncertainty by reviewing the size of their portfolios and hiking rents, research from Foundation Home Loans has revealed.

                            The research found over a third of landlords or 38% have reviewed the size of their portfolios in light of increased costs, while 7% have actually sold off properties. Larger landlords – who will be impacted by new Prudential Regulation Authority (PRA) rules from next month – are more likely to have taken action with 19% of landlords with 20 or more properties having reduced the size of portfolios.

                            Almost three quarters (71%) of landlords said they had experienced a drop in confidence; more so for those operating in Central (78%) and Outer London (77%).

                            Jeff Knight , marketing director, Foundation Home Loans, said: “Landlords have been met with a raft of changes, from Stamp Duty charges to shifts in tax policy, and the lack of certainty on the political front has clouded the picture somewhat. The response has been to ‘batten down the hatches’, streamlining larger portfolios and protecting income by increasing rents – decisions that can be reviewed once the buy to let market is more accommodating.”

                            He added: “The fact remains that, whether it’s as a stepping stone to home ownership or a longer term lifestyle decision for tenants, the rental sector is an increasingly important part of the housing mix. This will ultimately be best served by a wide choice of property, and good landlords who can have confidence in decent returns.”


                              Another lender, Hinckley & Rugby, has declared that with effect from 28th September they will no longer consider applications where the borrower(s) have four or more mortgaged Buy to Let loans. This as a broker is a shame as they had an old fashioned attitude towards this sector.


                                A forum poster PM'd me to enquire if the PRA rules applied where property was also held in a Ltd Company: the answer was that unfortunately the classification of a Portfolio Landlord involves the aggregation of all properties held in mortgage irrespective of whether they are all held in both a personal capacity or via a Ltd Company , so if these number four or more mortgaged properties , any application for a purchase or remortgage facility would render the applicant/SPV to assessment under the new affordability rules which kick in 18 days time.

                                I am attending two mortgage conferences over the next four weeks so I will have the attitude towards these changes from all leading lenders including those who are going to choose to withdraw from this element of Buy to Let and focus on the amateur investor.


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