TMW 145% stress testing

Casa1862

Doesn't look good, that a whole lot of extra rent to find!
http://www.theguardian.com/money/2016/apr/29/nationwide-tightens-lending-criteria-for-buy-to-let-landlords

Coupled with the small house price drop yesterday according to LR, I'm thinking twice about my BTL purchase I've got going through, however it's a three bed semi in Kettering in a very good area for £140k, glad i didn't go for a 1 bed flat in area more local and expensive. Decent 2 or 3 bed freehold houses hopefully will be in demand.... i could be wrong!

Thrugelmir

Reflects the changing tax landscape. Be interesting to see how it impacts new business for the lenders. They'll be a load of existing amateur LL's sleepwalking into a financial hole.

westernpromise

Casa1862 wrote: »

Doesn't look good, that a whole lot of extra rent to find!
http://www.theguardian.com/money/2016/apr/29/nationwide-tightens-lending-criteria-for-buy-to-let-landlords

Coupled with the small house price drop yesterday according to LR, I'm thinking twice about my BTL purchase I've got going through, however it's a three bed semi in Kettering in a very good area for £140k, glad i didn't go for a 1 bed flat in area more local and expensive. Decent 2 or 3 bed freehold houses hopefully will be in demand.... i could be wrong!

If they put it up to 750% I'll start to worry.

Crashy_Time

westernpromise wrote: »

If they put it up to 750% I'll start to worry.

You don`t make the market though.

cells

on a positive note, BM solutions the biggest BTL lender in the country cut its rates on 75% bands substantially about a week ago.....

The 145% stressed at 5.5% is a bad move for TMW. They are imo one of the best BTL lenders out there and this will lose them some custom or perhaps force the other bigger players to also move to 145%

cells

This is quite big news, it means a 75% down property can only be bid to 5.98% whereas currently it is 5.16%

So if the yield is below 6% TMW wont allow a 75% down purchase. You would need to put down a bigger deposit

However it does not impact the bigger landlords as they already have to put 40% down with TMW


If the whole market shifts to 145% @5.5% pay rate then the mortgage market is going to have to shift towards bigger deposits down.

Crashy_Time

Hilarious to see WP on the main board desperately trying to shut down any discussion about someone in Dundee maybe picking up a cheap flat in the near future, and this from someone supposedly totally happy, and rich, from their property decisions in London is it? Tragic comedy at it`s finest.:rotfl:

Conrad

Damn I was about to use them, now where's my calculator when I need it

Thrugelmir

cells wrote: »

The 145% stressed at 5.5% is a bad move for TMW. They are imo one of the best BTL lenders out there and this will lose them some custom or perhaps force the other bigger players to also move to 145%

New rules for BTL lending are already out for discussion with lenders. TMW is just moving to the new norm ahead of schedule. Rather like the MMR. Lenders are being given time to adjust so that the market moves in an orderly manner.

Casa1862

Natwest at 125% at 7% IR also high, Barclays 135% at 5.79%, makes it important to find a good lender with a decent follow on rate or at least retention products. My other btl is with Platform Mortages and they apparently don't offer retention products, either SRV or leave, find it difficult to understand why they want to turn away decent paying customers. I'm going with VIrgin this time to hopefully move onto something else when my fix comes to an end.

Thrugelmir

Casa1862 wrote: »

My other btl is with Platform Mortages and they apparently don't offer retention products, either SRV or leave, find it difficult to understand why they want to turn away decent paying customers.

Subsidiary of Co Op bank, whose financial troubles are well documented. Most likely a board decision to reduce exposure and possibly pull out of this sector of the market entirely.