Portfolio Landlords Oxford
On the 30th of September 2017, lenders implemented changes to the way in which buy to let mortgage applications are underwritten for portfolio landlords.
The definition of a portfolio landlord is defined as “borrowers with four or more distinct mortgaged buy-to-let properties”. These can be “either together or separately, in aggregate”. This is according to the Prudential Regulation Authority.
The main change which the PRA has brought in is that it requires all lenders to carry out specialist affordability checks. These must be carried out on any borrower who falls in to the Portfolio Landlord category. This has in turn seen a lot of lenders stop lending to landlords with 4 or more investment properties.
Lenders are now having to check that the landlord is not over-exposed. As such, they will look to stress test the landlord’s buy to let portfolio. Before, the lender wouldn’t pay too much attention to any properties in the background. This was as long as they were self-financing themselves. However, now the lender will now be looking at the whole property portfolio. Plus, they will be underwriting the portfolio as a whole. This in turn means more preparation. Also, it means more paperwork to prepare for the mortgage application.
The information / documents which most lenders are now looking for are:
- An up to date property portfolio spreadsheet.
- A Business Plan.
- Cash flow forecasts.
- Last 3 months bank statements.
- Submitted tax returns.
- Latest tax calculations or SA302’s.
- Income and Expenditure statements for your portfolio.
At IMS we can help you to prepare the above. Also, we have access to specialist lenders and products for Portfolio Landlords. This can be a confusing time for landlords looking to review or even start their portfolio. However, we can take the stress away from you and make the process as smooth as possible.