Specialist buy-to-let lender Fleet Mortgages has announced a range of criteria changes that it says offer landlords “greater levels of flexibility”.
The Hampshire-based firm says where there is a connection between a freeholder and a leaseholder within a property, it will no longer take a first charge on the freehold, only a legal charge.
The minimum gross external floor area is being reduced from 35 to 30 square metres for studio flats in urban areas, under its property guidelines.
The lender is also changing its exposure limit for developments, conversions and blocks of flats from 20 per cent, or one unit, of a block — to a new sliding scale.
It says it will now consider lending in a block of four or fewer flats up to 100 per cent of the development. If the block has five or more flats it will lend against two of the flats, or 20 per cent. In a block of 10 flats, Fleet will lend against a maximum of two.
Fleet adds it “will look at exceptions to this, on an individual basis, subject to a positive valuation report, with each exception referred to its funder for approval”.
Finally, the lender says portfolio landlord borrowers will no longer be required to provide an asset or liability statement for all applicants owning four or more properties. Only the main applicant will be required to provide the statement.
These changes take effect immediately.
Fleet Mortgages chief commercial officer Steve Cox says the lender has “been listening to our intermediary partners and working to deliver a series of criteria changes that will provide greater levels of flexibility for more of their landlord clients”.
Cox adds: “The idea is to allow Fleet to lend on an increasing number of properties, to an increasing number of landlords, and to ensure we are not placing too many obstacles or conditions on risk-worthy borrowers and properties.
“In particular, these changes will help open the door, particularly to those who are investing in conversions, flats and blocks, plus it will mean less onerous provision of documents for portfolio landlords.”
This post has originally been featured in Mortgage Strategy.