OneSavings Bank has added new lending criteria for portfolio landlords in preparation for the second phase of PRA changes, which come into effect on 1st October 2017.
The lender will now require mortgage applications from landlords who own four or more mortgaged properties to include a business plan, an assets and liabilities statement and a cash flow statement.
Landlords will also have to provide details of their wider buy-to-let portfolio.
Portfolio landlords will be subject to an interest rate stress test of 5% on the rest of their portfolio and must meet or exceed an interest cover ratio of 125.
Adrian Moloney, sales director at OneSavings Bank, said: “Brokers have had to move quickly to update their advice following a raft of tax and regulatory changes to the buy-to-let sector, and will need to do so again once the upcoming portfolio landlord changes land in October.
“There’s no doubt that greater scrutiny on loan affordability will be a good thing for the sustainability of the sector, but it will also mean more of an administrative burden.
“We’ve always welcomed portfolio landlords and the changes here cement our position as the lender of choice for these borrowers.
“We’ve chosen to announce our criteria well ahead of the October deadline to help brokers prepare for the changes in good time so they can feel confident when preparing clients to submit a portfolio application.”
Brokers can submit applications through the lender’s new buy-to-let hub developed in partnership with eTech.
OneSavings Bank is a specialist lending and retail savings group, which includes the Kent Reliance and InterBay brands.