Confused over BTL Remortgage

pcgtron

Hi all.

The flat that I own (With a mortgage) is currently on Natwest's SVR with consent to let. It has been let out for 14 months.

I have just been informed by my mortgage broker that Leeds have declined a mortgage in principal to remortgage this on a BTL basis due to a decline in my SA302 profits over the last 3 years.

I am slightly confused by this as I thought lender's didn't take into consideration earnings on BTL mortgages and worried about 125% of the interest payment of the mortgage at about 6% which the flat passes fine.

My broker has sent me another possible offer, it's just not as good as the one with Leeds and the only reason for my profit decline is being more tax efficient, and not a real decline in profits.

Do I just have to suck it up and try another company that only take 1 years into account, or will I struggle to get this BTL mortgage.
With everything I've read on here, about as long as earnings are over the 25k a year threshold (Which they are) then i'm just confused as the reason for the decline to me is more about affordability than anything else.

kingstreet

There are lenders who try to apply semi-residential underwriting methods to BTL and they tend to not last very long in the market.

I wouldn't go anywhere near Leeds for a BTL. TBH they are enough hassle when I have to use them for shared ownership.

amnblog

pcgtron wrote: »

Do I just have to suck it up.

If Leeds wont lend to you there is not much else you can do.

They are clearly not an option for you.

pcgtron

amnblog wrote: »

If Leeds wont lend to you there is not much else you can do.

They are clearly not an option for you.

What I really meant by that comment was do all BTL mortgage providers now look at your personal income and use that as a factor in their decision to lend or not, rather than can I appeal to Leeds.

amnblog

all lenders are different in their appraisal

Let_Us_See

Leeds BTL income criteria.

"The primary applicant must be able to demonstrate a primary income (earned or savings generated) of at least £20,000 per annum. Whilst the properties are expected to be self-financing, the presence of an additional income provides contingency in the event of ‘void’ periods."

pcgtron

Let_Us_See wrote: »

Leeds BTL income criteria.

"The primary applicant must be able to demonstrate a primary income (earned or savings generated) of at least £20,000 per annum. Whilst the properties are expected to be self-financing, the presence of an additional income provides contingency in the event of ‘void’ periods."

Weird then, as my primary income is a lot more than that, and the property is in London, and has been let for 14 months and counting

100saving

My broker told me the you need to have an income of at least £25k a year for most lenders, but I am a first time buyer as well.

Thrugelmir

100saving wrote: »

My broker told me the you need to have an income of at least £25k a year for most lenders, but I am a first time buyer as well.

Do you own another residential property?

pcgtron

Thrugelmir wrote: »

Do you own another residential property?

I own a residential property with a mortgage

Let_Us_See

If your income is above the lender's minimum requirements, and the decline is due to income, then I can only surmise that your declining profit is the problem.