Accord Mortgages has published details of its lending criteria for portfolio landlords, which come into effect on 30 September.
The lender has defined its requirements for those landlords who own four or more mortgaged buy-to-let properties, in accordance with stricter underwriting standards outlined by the Prudential Regulation Authority (PRA).
Accord will assess the financial strength and competency of a portfolio landlord by taking into consideration their experience in the buy-to-let market, their full property portfolio and any outstanding mortgages along with their assets and liabilities.
The lender’s existing rental calculations will apply for new borrowing. All background properties must collectively meet a minimum rental calculation of 135% interest coverage ratio (ICR) at a stressed rate of 5%.
There will be no changes to loan to value (LTV) limits, maximum loan size or minimum income criteria, while stress rates and the number of properties accepted will remain the same.
Chris Maggs (pictured), Accord’s buy-to-let commercial manager, said: “With so many changes happening to the buy-to-let market recently we believe it’s important to be transparent about our changes to criteria so brokers and landlords have time to prepare ahead of the new rules.
“We’ve tried to make our portfolio lending criteria as simple and straight forward as possible. In addition to our standard criteria, portfolio landlords will be required to supply details of any applications currently being processed with other lenders and complete an assets statement. We will also ask these landlords if they anticipate any financial changes or changes in circumstances which could impact the affordability of their portfolio.”
