Independent Financial Life Planners Bishop's Stortford: Where are buy-to-let mortgages heading?

Tuesday, 10 January 2017

Where are buy-to-let mortgages heading?

Several of Enable’s clients in Bishop’s Stortford have residential property included in their financial plans and if you are a smaller landlord there could be good news buy-to-let mortgages are predicted to fall in 2017 for ordinary landlords, but they may get more expensive for professional landlords with large portfolios.

Mortgage broker John Charcol is predicting a buy-to-let mortgage rate war in the so-called 'vanilla' end of the market, (landlords with just one or two properties) as a wave of tax and regulation changes drive the big high street lenders to drop rates for smaller scale landlords with lots of equity, who they consider lower risk. 'I definitely believe that we may well see a bit more competition in the very vanilla section of the buy-to-let market said Simon Collins, of mortgage broker John Charcol, says: 'Whether this will lead to higher pricing in the complex end of the market is really yet to be seen but the whole buy-to-let market is undergoing a real sea change.'

Tougher lending rules that have applied from 1 January have been forced on lenders by the Bank of England. These mean that the vast majority of buy-to-let mortgages will only be approved if the landlord can demonstrate their rental income would cover their mortgage payment by a ratio of 145 per cent if their mortgage rate went up to 5.5 per cent. This is a significant jump from the recent norm applied by lenders, of 125 per cent rental coverage at a lower rate.

Your home could be at risk if you do not keep up your mortgage repayments

Issued by: Enable Independent Financial Life Planners •  25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

http://www.thisismoney.co.uk/money/buytolet/article-4048980/Buy-let-mortgage-rates-predicted-fall-2017.html

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IFA Bishop's Stortford

At Enable Independent we know that our clients trust us and rely on our advice to help them to plan a better, more secure financial future. This is a responsibility that we take very seriously especially because we know that many clients have chosen us on the recommendation of friends and family. Each one of our advisers has deep expertise in their area of specialist knowledge and, as a team, we hold some of the highest qualifications available in the financial advice industry.

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