The Mortgage Works has made made enhancements to support landlords who want to grow their portfolios.
The lender has increased the maximum loan per property to £2 million for buy-to-let (BTL) and limited company applications up from £1.5 million previously and £1 million for let to buy up from £500,000 previously.
In addition, maximum overall borrowing is increasing to £7.5 million as part of The Mortgage Works’ ambition to support landlords with larger portfolios.
As part of the affordability assessment for portfolio applications, The Mortgage Works will assess properties within a landlord’s existing portfolio to ensure the interest cover ratio (ICR) and loan-to-value (LTV) are sustainable.
The Mortgage Works will now be splitting the current background ICR policy of 145% and will apply 125% to any properties in the portfolio owned within a limited company structure.
For properties personally owned, the ICR policy will remain at 145%. The stress rate of 4.75% and maximum aggregate LTV of 75% that also apply in the aggregate portfolio policy will remain unchanged.
The Mortgage Works head of BTL mortgages Dan Clinton says: “This is the latest in a series of enhancements we’re making to our landlord offering. Brokers have been highlighting the need for these changes, and we have listened and delivered.”
“As one of the country’s largest buy-to-let providers, it’s important we support landlords across their entire portfolio, and these enhancements will enable us to do just that.”
John Charcol mortgage technical manager Nick Mendes adds: “The Mortgage Works’s increase to maximum loan sizes and refinement of its aggregate portfolio policy are a clear show of support for professional landlords.”
“Higher caps give experienced investors more flexibility to fund and refinance larger assets, while applying a 125% ICR to limited company holdings reflects prevailing market practice and should improve case certainty for well-run SPVs.”
“Overall, these are pragmatic changes that align affordability and capacity with real-world portfolio management, signalling continued commitment to the professional BTL market.”
