Some big changes have occurred in the mortgage market since we last spoke, some good and some slightly more challenging! The BTL market has had a big shake up with the introduction of stricter lending criteria, there is greater competition in the market for First time buyers which is providing more products and better criteria and new lenders are entering the market which again is providing more choice to customers and providing competition to the more established names.
The introduction of the Prudential Regulation Authority(PRA) has put a tighter squeeze on the BTL market by introducing new affordability guidelines to mortgage lenders which unfortunately have been passed on to customer. These rules can make it harder to place a BTL mortgage and there is greater work involved in sourcing a product for a client, in many cases clients may need to provide larger deposits than were previously required. (Source: Bank of England 29/09/2016)
The Help to buy mortgage guarantee has now also been removed by the government for first time buyers and second steppers for 95% mortgages, the good news is that the lenders have now released their own products at 95% and we have already seen some of our clients benefitting from these changes with the improved eligibility criteria.