Buy to Let

Nottingham BS loosens BTL criteria

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Nottingham Building Society has loosened its buy-to-let criteria on income multiples and increased maximum loan size.

The mutual has increased the loan size cap for BTL applications from £250,000 to £350,000 and increased the single income calculation from ‘3.75 x single income’ to 4 x single income. The joint remains at 3.75.

Martyn Bell, mortgage product manager at The Nottingham, said: “We believe these criteria changes will help more applicants get the residential or BTL property they want at competitive rates, even at the higher LTVs where some bigger lenders are still reluctant to lend.”

The Nottingham is developing an alternative affordability model to replace its income multiple calculation in 2014 to tally with the introduction of MMR.

Lea Karasavvas, managing director of Prolific Mortgage Finance, said upping the loan maximum to £350,000 is likely to widen the geographic spread of Nottingham’s appeal to London buyers.

“Asa smaller lender it is understandable, but four times income is still a little conservative when Abbey, Woolwich, Virgin and NatWest are doing five times,” he said.

Precise also eased its minimum income requirements and are willing to work off bank statements, he said, adding that he expects a few more lenders to loosen buy-to-let criteria this year.

“If you include let-to-buy, 30-40% of our enquiries are buy-to-let at the moment, despite interest peaking in the early part of 2012. This should be another strong year for the market as a whole,” said Karasavvas.