Lender exodus from buy-to-let mortgage market in full swing
Research by a leading mortgage brokers reveals both small, medium and large lenders suspending or severely reducing their buy-to-let mortgage ranges.
Lenders are pulling the plug on mortgage applications and reducing their buy-to-let product ranges, leaving landlords struggling to find deals.
Online buy-to-let mortgage broker Property Master warns that the buy-to-let mortgage market is going into reverse as the impact of the Coronavirus begins to bite, with some lenders even quitting the market for the foreseeable future.
“Landlords are finding that their borrowing options are being drastically reduced as lenders respond to this new record low base rate environment and fears of falling house prices by withdrawing entire product ranges,” says chief executive Angus Stewart.
“We have had clients mid-way through a mortgage application only to find the process is halted and the product withdrawn before they can reach completion and the release of funds.”
It reports that Saffron Building Society, which offered a range of mortgages including for portfolio and limited company landlords, now has no products available, while The Melton Mowbray Building Society and Vida have followed suit.
Together Money has suspended lending in both the buy-to-let and residential market, and Barclays has withdrawn all its products for portfolio landlords.
The Mortgage Works and HSBC have both withdrawn their tracker mortgages for the foreseeable future, while other lenders are tightening criteria; Kensington Mortgages, for example, has reduced maximum loan to value lending criteria down from 85% to 75%. Some lenders have increased rates despite the 0.65% fall in base rate.
Stewart adds: “We would urge lenders to continue to support landlord customers, especially those who were moving successfully through the mortgage application process and would otherwise have expected to be shortly in receipt of a loan. Similarly, we would urge banks to stand by the commitment made by the Government to provide payment holidays to landlord customers.”