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BHHS Kay & Co landlord and residential mortgage market update courtesy of Connaught Private Finance

With all that has happend in the last few weeks, many lenders have stopped lending all together. Saffron Building Society, Kent Reliance, Melton Mowbray, Vida Homeloans and Together Money are among those who have suspended lending. Santander will only do residential mortgages up to £350,000 and no more than 75% loan to value, with no applications for buy-to-let being accepted. Virgin and Clydesdale are at 60% for residential and 55% for buy-to-let on remortgage business only, and Barclays have pulled loans over 60% loan to value.

The reason for this is due to the banks having to pull staff off of new business to deal with the demand from existing customers for the mortgage holidays, as part of the governments request that banks offer this option to the public. The second reason is that with the essential lock down, surveyors for the main banks are no longer able to inspect the properties. This has led to many banks looking for a solution to overcome this, especially in the remortgage market. The outcome is that lenders are now doing desk top or AVM’s (Automated valuation model) to establish the value and make a lending decision. The AVM’s are usually capped at 60-65% depending on which lender you approach, but things are moving. The next delay of course is the legal side, as the bulk of solicitors are working from home, but the good news is that things are moving, albeit slowly.

For those of you that are with the main lenders, you may be able to request mortgage holidays. Some lenders will ask for your situation and whether you have income to support any rental voids in the event your tenant cannot pay? However many of the mainstream lenders in the buy-to-let market such as Birmingham Midshires (BM Solutions) and The Mortgage Works (TMW) are offering this option, which many of our clients have already taken up as a precaution. Some of the challenger banks and niche lenders, such as Fleet/Hinckley are offering this, but are asking more questions around your personal circumstances. If you want to consider the options with your mortgage(s) then we suggest you speak with your lenders directly to see if you would be able to take advantage of this option, should you wish.

As a guide here are some of the leading products in the market at the moment:

Residential

  • 2 year fixed rate at 1.17% (purchase)
  • 2 year tracker at 1.17% (remortgage only)
  • 2 year fixed rate a 1.19% (remortgage only, exclusive to Connaught Private Finance)

Buy-To-Let

  • 2 year tracker at 1.10% (1% over Bank of England base rate, remortgage only)
  • 2 year fixed rate at 1.19% (purchase)

Company Buy-To-Let

  • 2 year fixed rate at 2.59% (exclusive to Connaught Private Finance)
  • 5 year fixed rate at 2.59% (exclusive to Connaught Private Finance)

Residential Mortgage Lender compared to Connaught Private Finance

  Halifax Connaught Private Finance
Mortgage Value £600,000 £600,000
Current Balance £350,000 £350,000
Term Remaining 20 years
Capital and interest
Same terms
2 year fixed rate at 1.12%
Monthly Payments £2,176.67
(Standard variable rate at 4.24%)
£1,628.44
Monthly Savings   £548.23

Buy-To-Let Mortgage Lender Compared to Connaught Private Finance

  Birmingham Midshires Connaught Private Finance
Mortgage Value £600,000 £600,000
Current Balance £350,000 £350,000
Term Remaining 20 years
Interest only
Same terms
2 year fixed rate at 1.19%
Monthly Payments £1,295
(Standard variable rate at 4.24%)
£347.08
Monthly Savings   £947.92

Berkshire Hathaway HomeServices have teamed up with Connaught Private Finance to provide mortgages exclusively for our clients. We are now offering our service to those of you that have one property, multiple properties or portfolios. With many of our clients looking to take advantage of the current market conditions, we are seeing some of you looking to; invest in more property, release capital or secure a lower rate, which we can arrange up to 6 months in advance. Should you wish to discuss your mortgage requirements, including residential, then please call: +44 (0)20 3394 0018 or email: landlords@connaughtpf.com

 

Click here for further information about Connaught Private Finance

Did you know...overvaluing your home by just 5% can result in half the interest on your property!

We understand how vital it is to give an accurate valuation. We do not believe in 'overvaluing' to win an instruction. Once you are a client of ours, we like to believe that you will be with us for life, for all your property needs. For us, trust is very important, so we aim to be honest with you from the very start. We will do our upmost to help you achieve the highest price possible, whilst presenting the most suitable buyers or tenants. It all begins with a valuation...