Launch Pad: Mortgages

Santander for Intermediaries has enhanced the lending criteria on its buy-to-let mortgage range in an effort to make it more accessible for non-professional landlords. It has also removed early repayment charges from all of its standard residential tracker mortgages.

The provider’s buy-to-let affordability rate has been reduced to 5 per cent from 6 per cent, while the minimum gross rental income requirement from the property continues to be 125 per cent of the mortgage payment.

The maximum loan size of a property has increased from £500,000 to £750,000.

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Conditions include:

• Borrowers must be aged between 21 and 70.

• If there is more than one borrower then at least one must be employed and earning more than £25,000 a year.

• Minimum purchase price of £75,000

• Minimum deposit of 25 per cent, and rental cover of 125 per cent or above, calculated on an interest-only basis

• Applicants must already have a residential or buy-to-let mortgage

Phil Cliff, director of retail assets for Santander for Intermediaries, said: “The buy-to-let market has seen strong growth in the past couple of years and we are keen to increase our support of this market.”

IFA Verdict

Jane King, principal of Ash Ridge Asset Management, London

“Santander appears to enjoy grabbing money from the Funding for Lending scheme. These changes have brought some of its more onerous conditions in line with the rest of the market.

“Dropping affordability to 5 per cent is quite good and I like the maximum loan size of £750,000, especially for London clients. Dropping early repayment charges on trackers is also good, but I would ask how can Santander for Intermediaries afford to do it?”