7
May
Buy-to-let mortgage lenders limit exposure
Buy-to-let mortgage lenders Bank of Scotland, BM Solutions, and The
Mortgage Business all revealed yesterday that they are to reduce
their exposure to risk.
They will do so by cutting maximum loan amounts on new-build
properties and withdrawing a number of competitive rates, the
Financial Times reported.
Maximum loan-to-value ratios on new-build flats offered by the
lenders have now been reduced from 85 per cent to 75 per
cent.
Other banks and building societies have already taken similar
decisions, including Nationwide and Chelsea Build Society, who have
stopped lending in the sector altogether.
Speaking to the newspaper, David Hollingworth from London &
Country Mortgages said: "Everyone has been showing a much reduced
appetite in this area due to issues around the transparency of
builders' incentives, the real value of the properties and major
fraud."
Moneysupermarket.com reported yesterday that there has been a 40
per cent drop in the number of buy-to-let mortgage products
available in the last month alone.
