Landlords have recently received good news from The Mortgage Works, one of the biggest buy-to-let lenders in the UK, which has significantly loosened its criteria on new deals.
The Mortgage Works, a specialist lending section of Nationwide Building Society, has increased its loan-to-value cap from 75 per cent to 80 per cent. This has been seen as a sign of increasing confidence in the stability of house prices throughout the country.
Brokers and landlords, who have welcomed the move, are hoping that other lenders will follow Nationwide.
The new cap has been a welcome ray of hope for landlords who have struggled to secure financing for buy-to-let property since the second half of 2007. The fear of newly tumbling property values has kept lenders cautious and imposed tough caps on prospective investors.
David Hollingworth of London & Country Mortgages has joined others in the view that the new Nationwide cap is the beginning of a positive trend. He told Times Online: ?It has to be another sign of lenders? growing confidence in the market, as prices have stabilised. It is certainly encouraging for landlords who have seen the buy-to-let mortgage market tighten enormously in the last few years.?
It does seem that other lenders are gradually following suit. The Shepshed Building Society, for example, also increased its loan-to-value ratio to 80 per cent, while Nottingham Building Society increased its maximum value to 75 per cent.
A broker from Trinity Financial Group, Aaron Strutt, affirmed that landlords who had to deposit 40 per cent of the property value last year are now considerably less constrained.
