In a move aimed at benefiting large portfolio landlords, The Mortgage Works (TMW), Nationwide Building Societies buy-to-let arm, has announced some noteworthy updates to its existing portfolio affordability assessment criteria, effective from the 17th of October 2023. These changes are set to make it easier for experienced landlords to expand their buy-to-let portfolios, opening new opportunities in the property investment market.
Increased Maximum Loan-to-Value For Regular And Large Portfolio Landlords
One of the key changes announced by TMW is the increase in the maximum loan-to-value for portfolios with 11 or more properties. Previously capped at 65%, the maximum LTV has now been raised to 75%. This change means that portfolio landlords can access more financing when adding new properties to their buy-to-let portfolios with smaller deposits and larger borrowing, making expansion more accessible and potentially more profitable for professional investors. In a market that hasn’t been particularly kind to landlords in recent months, this increase in TMW’s LTV criteria for portfolio landlords is a clear sign of their commitment to supporting the growth of experienced investors’ portfolios and keeping up with market demand for more flexible financing options.
Reduced Buy-to-let Stress Rate
Another significant update is the reduction of the stress rate that TMW imposes on all new buy-to-let applications from 5.25% to 5.00%. The stress rate is used to assess whether a borrower can afford the mortgage repayments under a variety of scenarios, ensuring that they can comfortably manage their financial commitments, even if interest rates rise or their circumstances change. A lower stress rate is great for landlords as it means they can borrow more money while keeping repayments affordable and hopefully keeping the property profitable.
Aggregate Portfolio LTV Increase
Additionally, TMW has expanded the aggregate portfolio LTV to 75% in cases where the Nationwide Buy-to-Let (BTL) exposure is over £1 million. This increase provides an extra layer of flexibility for portfolio landlords with substantial investments and exposure to Nationwide’s BTL lending. It allows them to leverage their existing holdings more effectively, potentially fuelling further property acquisitions.
The Large Buy-to-Let Portfolio Products
The Mortgage Works offers a range of Large Buy-to-Let Portfolio products to cater to the specific needs of portfolio landlords with many properties. These products provide competitive rates and terms, enabling landlords to make the most of their investments. Here are some of the Large Buy-to-Let Portfolio products currently available:
- Buy to Let Large Portfolio Fixed 5.24% for 5 years with a 3.00% fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.29% for 2 years with a 3.00% fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.49% for 2 years with a 3.00% fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.59% for 5 years with a £1,495 fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.64% for 5 years with a £1,495 fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.79% for 5 years with no fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.94% for 2 years with a £1,495 fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 5.99% for 2 years with a £1,495 fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 6.49% for 2 years with no fee and a 75% LTV.
- Buy to Let Large Portfolio Fixed 6.99% for 2 years with no fee and a 75% LTV.
Speak To A Buy-To-Let Portfolio Mortgage Expert
The Mortgage Works’ recent updates to its portfolio affordability assessment criteria represent a significant step in favour of portfolio landlords. With increased LTV, reduced stress rates, and expanded aggregate portfolio LTV, these changes facilitate portfolio expansion, making it more accessible for experienced investors to continue making profits from their investments in the UK buy-to-let market. If you are a buy-to-let landlord looking for help with arranging your mortgages, then please feel free to give our experienced buy-to-let mortgage advisors a call today or drop us an email.