17:21 PM, 24th February 2012, About 10 years ago 6
Mortgage underwriters are set to ask borrowers detailed personal questions about their spending habits as the banks tighten up lending rules.
Santander’s Abbey for Intermediaries – which includes buy to let lending for landlords – will quiz applicants about how much they spent on Christmas and birthday presents.
Other one-off spending will also come under scrutiny, like holidays, celebrations and ‘miscellaneous’ spending.
Abbey has warned borrowers they expect realistic cash amounts entered on application forms that may need to be supported by receipts or bank statements – entering a zero will result in a declined application.
Previously, Abbey has assessed personal spending by entering an estimate based on figures from the Office of National Statistics.
Nationwide’s buy to let brand, The Mortgage works (TMW), has revised some landlord and guarantor mortgages.
Buy to let deals now include a two-year fixed rate at 4.49%, up to 75% loan to value with a 3.50% fee for buying and remortgage.
Other new packages include two-year trackers for buy to let at 3.64% and let to buy loan at 3.94%.
Both come at up to 65% loan to value, with 3.5% arrangement fees.
Meanwhile, mortgage brokers are optimistic that buy to let will continue to grow – eight out of 10 expect to see the sector grow for landlords over the next year, according to a survey by the Intermediary Mortgage Lenders Association (IMLA).
John Heron, IMLA chairman, said: “Buy to let is becoming increasingly important as more people move into the private rented sector. For landlords, an intermediary can provide invaluable support during the process of finding the right mortgage and right mortgage lender for their needs. “The same is of course true of the market in general. Intermediaries are best placed to find a solution for borrowers who return empty-handed from a trawl across the high street lenders. The benefits to the consumer of professional mortgage advice are not always rated highly enough and need to be better communicated.”