Lenders target professionals

Professional landlords may have the edge in the current market as lenders target those with big deposits.

Mortgages for Business, a specialist buy-to-let broker, has said lenders are increasingly requiring investors to put down deposits of 20-30%, compared to the norm of 15% over the past three years. Such low requirements encouraged many smaller portfolio investors into the market, according to Mortgages for Business, but the credit crunch has forced mortgage lenders to reconsider their exposure to risk.

Jonathan Moore, head of marketing at Mortgages for Business, said: “There are still 15% deposit requirement mortgages available, however they are now in the minority which is surprising news to many investors when they come to make a purchase or remortgage.

“We are also starting to see differentiated loan-to-value pricing, with those investors with a smaller deposit having to choose a mortgage with a more expensive headline rate or larger arrangement fee."

Moore believes lenders are targeting products at professional landlords with larger portfolios who continue to be active in the marketplace. He says such landlords are increasingly able to exert pressure on purchase prices and continue to make purchases.

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