Vida Homeloans has announced an enhancement to its buy-to-let (BTL) proposition by expanding its criteria to allow more special purpose vehicle (SPV) structures.
Vida Homeloans will now accept BTL SPVs where the applicant company is a subsidiary of a parent company.
This augmentation of the BTL proposition allows Vida Homeloans to support a broader range of landlords whose eligibility would have been restricted due to more complex corporate structures.
This meets the needs of modern landlords and the wider intermediary market. For brokers, they can enjoy greater flexibility in more complex cases as a result.
New parameters of SPV criteria
The enhancements of the BTL criteria are as follows:
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- A maximum of two company layers is permitted – the SPV and parent company.
- The directors of the SPV must match those of the parent company and must collectively hold a minimum of 75% of the shares in the parent company.
- All directors and shareholders of the SPV must be named on the mortgage application
This type of arrangement is more common among portfolio-focused investors, who tend to be more experienced. Landlords who specialise in high-value or multi-unit assets can benefit from greater savings.
Vida Homeloans’ enhancement accounts for the increasing number of landlords who are changing the way they structure their portfolios.
Dave Angel, managing director of mortgage product management at Vida Homeloans, said: “The buy-to-let market continues to evolve, and we know that for various operational and financial reasons, many landlords choose to structure their property business as a subsidiary of a parent company.”
He added: “We’ve listened to feedback from our intermediary partners and acknowledge our previous policy didn’t support customers with these more complex arrangements; buy to let is a key part of our proposition, so I’m pleased we’ve been able to make this positive change that reflects the reality of how many landlords operate.”