Buy to Let

Paradigm launches portfolio landlord crib sheet for brokers

Paradigm Mortgage Services has launched a factsheet drawing together information on all buy-to-let lenders who have announced how they will underwrite portfolio landlords from 30 September.  

On that date the Prudential Regulation Authority will bring in stricter underwriting requirements for landlords with four or more mortgaged properties. 

Many lenders have announced how they will handle the changes, though many are still finalising their plans. 

The factsheet will contain matrix-based information on each lender’s portfolio landlord underwriting policies so brokers can compare and contrast. 

Paradigm’s document will provide information including: 

  • How the lender defines a portfolio landlord
  • Whether the lender allows portfolio landlord applicants and whether it has a specific scheme for them
  • The number of buy-to-let properties allowed with the lender and elsewhere
  • Document requirements and the range of additional underwriting that will be carried out
  • The lender’s rental assessment calculation, what additional rental checks there are and whether the lender will ‘top-slice’ income
  • When lenders will introduce new criteria for portfolio landlords

Paradigm has also produced a rental calculation document which shows all those lenders on the Paradigm panel and their current rental calculations and ICR stress tests.  

Paradigm will update the factsheet as more lenders reveal their portfolio plans. 

Paradigm Mortgage Services head John Coffield says: “There are now less than two months until the PRA’s underwriting changes for portfolio landlords are brought in and we are starting to hear from lenders about how they intend to approach the new rules.  

“At the time of writing we have just a handful of lenders who have come forward but we anticipate more will follow in the coming weeks.  

“There’s no doubting that some of the announcements and detail already provided are quite confusing, particularly when a lender states that they will accept applications from portfolio landlords but when reading the details it’s obvious they have no intention in playing in the complex market of portfolios and limited company transactions.” 

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