X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • HMO & Multi-Lets

    Lloyds bank restricting BTL mortgages to just 3 per person!

    Just heard from a source that after 25 September the Lloyds Bank group will only lend a BTL mortgage on up to 3 properties for each individual. So that includes Birmingham Midshires!

     

    Quote from Lloyds Bank

     

    "From 25 September, Buy to Let property portfolios will be limited to a maximum of three properties, or £2m worth of lending (whichever is exceeded first), across Lloyds Banking Group. At the same time, Buy to Let products will no longer be available via intermediary channels through either the Cheltenham and Gloucester or LTSB Scotland brands."

     

    Apparently BM are wanting to concentrate on attracting new "first time landlords" instead of lending to us experienced ones!

    0
    0
    Kevin Boyd
    Property Developer & Coach
    "Helping you take your first step in property"
    www.UpwardSpiral.uk.com
    Sounds like a great idea, lend money to people who have no clue how to manage property, and ignore the ones with experience
    0
    0
    I guess it's about risk and over-exposure with one person!
    The main impact will be on deal sourcers and portfolio builders who "take advantage" of BM's slightly more relaxed lending criteria. BM do tend to have the best products and now we can only have three of them! It will restrict people building large portfolios, which, in some ways, has got to be a good thing from the sustainability point of view imho.
    0
    0
    Flip it around.
    Maybe they want to treat BTL investors as business people who should be dealing with the commercial side of the bank like any other business or commercial property investor.
    At the same time there is one bank (NatWest but maybe some other bank) who has a loan book that is X% of their business. The bank wants the target to be Y%. To get to Y% they need to shrink the loan book.
    X% minus Y% equals a reduction of 17%. If some of the customers are at too high of an LTV those borrowers are likely to stay on the loan book. The lender will need to greatly reduce new business while encouraging borrowers who have equity to go somewhere else rather than staying with the bank. Keep the worst and force out the good so you can reduce the loan book to Y%.
    John Corey
    Follow me on Twitter-> https://www.twitter.com/john_corey
    https://www.ChelseaPrivateEquity.com/blog
    0
    0

    John Corey 


    I host the London Real Estate Meet on the 2nd Tuesday of every month since 2005. If you have never been before, email me for the 'new visitor' link.

    PropertyFortress.com/Events

    Also happy to chat on the phone. Pay It Forward; my way of giving back through sharing. Click on the link: PropertyFortress.com/Ask-John to book a time. I will call you at the time you selected. Nothing to buy. Just be prepared with your questions so we can use the 20 minutes wisely.

    John
    You make a very good point here. The likes of BM use a credit scoring model for their underwriting but never ask for a balance sheet, P&L or cash flow forecast. However, if you dealt with the commercial side of Lloyds, these would be a standard requirement for a lending decision. Maybe they will start treating property investment as a business.
    The restriction also shows that BM are now targetting inexperienced investors. I was talking to someone who has over 20 years experience in the property business. He couldn't get a mortgage from BM so he put the deal in his girlfriend's name. She knew nothing about property but was approved immediately!
    Adrian Standing
    https://www.juniperproperty.com
    0
    0
    Experience does matter. At the same time an experienced person who goes bankrupt will be a loss for the bank. If the bank can spread around who they are lending to and the borrowers are small investors with real incomes the default risk might be less or the recovery might be better.
    The banks want lower risk from single point of failure.
    John Corey
    Follow me on Twitter-> https://www.twitter.com/john_corey
    https://www.ChelseaPrivateEquity.com/blog
    0
    0

    John Corey 


    I host the London Real Estate Meet on the 2nd Tuesday of every month since 2005. If you have never been before, email me for the 'new visitor' link.

    PropertyFortress.com/Events

    Also happy to chat on the phone. Pay It Forward; my way of giving back through sharing. Click on the link: PropertyFortress.com/Ask-John to book a time. I will call you at the time you selected. Nothing to buy. Just be prepared with your questions so we can use the 20 minutes wisely.