BM SolutionsAug 22 2017

BM Solutions sets out portfolio lending requirements

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BM Solutions sets out portfolio lending requirements
BySimon Allin

BM Solutions has provided details of the underwriting criteria it will apply to applications from portfolio landlords from 30 September.

The lender has set a maximum of 10 mortgaged buy-to-let (BTL) properties, including any new application to BM Solutions. 

A maximum of three properties will be allowed with Lloyds Banking Group, which includes BM Solutions.

The lender will apply an aggregate portfolio rental cover ratio of 145 per cent stressed at 5.5 per cent.

It will also require a minimum of £30,000 earned taxable income per application, alongside a maximum aggregate portfolio loan-to-value of 75 per cent.

Applicants with four or more mortgaged BTL properties will be required to provide further information when the full application is made, including proof of income and supporting documentation.

All applications will continue to be submitted online via the BM Solutions mortgage application system, with no change to its individually tailored process for landlords with three or fewer mortgaged buy-to-let properties. 

The lender has launched a national broker roadshow campaign to help intermediaries get to grips with the new changes.

Phil Rickards, head of BM Solutions, said: “Keeping things as simple as possible for brokers is a fundamental part of our continued support for the market as we move through the next major change as an industry.

"Our tailored approach is designed to help brokers continue to write quality business for portfolio landlords, supported by our expert underwriters and top-class service. 

“From this week we are speaking to several thousand brokers up and down the country, covering the new criteria in detail and helping show how it will translate into real time for their businesses.

"There are still a few places remaining so those still looking to attend should contact their business development manager as soon as possible.”

A number of lenders have now revealed their approaches to portfolio landlords ahead of the Prudential Regulation Authority’s 30 September deadline, with considerable variation in their requirements.

Aldermore, will ask for additional supporting documents for those with 11 or more mortgaged buy-to-let properties.

Meanwhile Accord will assess the financial strength and competency of a portfolio landlord by taking into consideration their experience in the buy-to-let market, their full property portfolio and any outstanding mortgages along with their assets and liabilities.

Kevin Dunn, mortgage and protection adviser at Leicestershire-based Furnley House, welcomed the relative simplicity of BM Solutions’ approach but said it did not necessarily make brokers’ lives easier.

“I would welcome any simplification in the systems, however the onus gets pushed to the adviser – we still have to do our due diligence and get the usual proof of rental income, bank statements and do the full sourcing,” he explained.