Fleet Mortgages has introduced a number of criteria changes.
These changes to the lender’s criteria cover a wide range of areas from the acceptance of gifted deposits, to minimum property valuation, maximum aggregate exposure for landlords and the acceptance of certain building certificates.
For the first time, Fleet Mortgages will now allow gifted deposits to borrowers if they have come from the immediate family, meaning a parent, sibling or grandparent. In order for this to be acceptable bank statements will be needed to show the source of the funds, and a solicitor must obtain identification from the gifter, and written confirmation that this is a non-refundable gift and the gifter will have no interest in the property.
The minimum valuation accepted by Fleet Mortgages for both HMO and ex-Local Authority properties has been cut by £50,000 to £100,000 in regions outside London and the South East. It remains £150,000 for properties inside London and the South East.
In terms of the maximum aggregate exposure a landlord borrower can have with Fleet Mortgages, the maximum LTV will be 60% up to £2m (previously 65%), however the lender has also introduced a further level of 55% up to £5m, allowing a greater level of total borrowing per individual/limited company.
In addition, Fleet has dropped its minimum external floor area property requirements from 40sqm to 35sqm, flats above or adjacent to commercial premises no longer have to be situated in a city centre location, and if the property was built within the last 10 years, it has now added two certificates to its accepted certificates list – CRL Warranty Scheme and ICW Warranty Certificate.
Bob Young, CEO of Fleet Mortgages, said: “When we review our criteria our aim is to maintain our responsible lending focus but to also respond to our intermediary partners’ feedback and to the changing nature of the mortgage and property market. Certainly, since the result of the EU referendum there has been a need to adopt a slightly more cautious approach to our lending, given the level of uncertainty about how the decision to leave might ultimately pan out for our sector and coupled with the fact that it has been an incredibly busy time for us recently.
“That said, in terms of the criteria changes we have announced today, our aim has been to develop our flexibility – in areas such as the acceptance of gifted deposits from immediate family members – and to recognise the quality of our borrower and the ongoing demand for our products, which is why we have introduced the new 55% LTV/£5 million maximum aggregate exposure level. Add into this our dropping of the minimum valuation for HMO/ex-LA properties outside London and the South East plus the drop in minimum external floor area, and we believe we are responding to landlord (and intermediary) demand in a number of different areas.
“We are currently in the process of reviewing our full product range, in light of the Brexit vote and how the rest of the buy-to-let sector responds to it, and we will be announcing new products very shortly. Our commitment to both buy-to-let and intermediary distribution has not wavered and we will be working closely with all partners and stakeholders to deliver a service and proposition that can excel in this new market environment.”
