Santander expands buy-to-let criteria

Santander expands buy-to-let criteria

Santander is set to increase the maximum lending age and lending term on its buy-to-let mortgages.

From today (April 15), the high street lender will increase the maximum lending age — the age at the end of the mortgage term — from 75 years to 85 years, increasing the number of older borrowers able to take out a policy.

On top of this, the maximum lending term will increase from 25 years to 40 years.

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Therefore, where previously the upper end of Santander's buy-to-let range would be a 50-year-old taking out a 25-year lending term, now, a 45-year-old can borrow for a 40-year period.

The maximum LTV offered on the lender's policies will remain at 75 per cent.

Speaking to FTAdviser, Graham Sellar, head of channel development at Santander, said the firm was looking to help those preparing for retirement as people are living longer.

He said: "By increasing both the maximum term and maximum lending age, we're hoping to help landlords reap the benefits of their investment for longer.

"We've seen a demand from older customers. People can decide to live off a rental income when looking at their future and by broadening our terms, advisers have more options to present to their clients."

Peter Wright, director and adviser at Plan Money, said: "This is a positive move from Santander as any more flexibility within the buy-to-let market is a good thing. 

"But the next stage is for the market to go even further. Why is there a maximum age on these policies? Customers aren't necessarily going to stop renting out once they've retired.

"You'll stop the policy when you sell the property. I think the reason you have a maximum age on the policy is because there's one on residential mortgages — but it's a completely different market."