Adrian Moloney - Group Sales Director
Ahhh, 1996 – what a year that was. Seeing the mighty Oasis play at Knebworth, spending a long, hot summer working in Tenerife, and watching Gazza and Co almost leading England to glory in the European Football Championships.
Although I didn’t know it at the time, 1996 was also the year that saw the launch of a product which would go on to shape my career: the first dedicated buy to let mortgage.
Difficult as it might be to believe, this year marks the 25th anniversary of a product which has transformed the UK’s housing market. In the quarter of a century since, the private rented sector has virtually doubled in size, growing from 2.4 million properties in 1996 to 4.4 million today and now accounts for 19% of the country’s households*.
To help those struggling to secure the buy to let mortgage they needed because high street lenders’ criteria was so strict, Precise Mortgages was launched in 2010.
In the years since, we’ve gone on to become one of the UK’s leading specialist lenders, with a reputation for being amongst the most forward-thinking lenders in the market. If you’ve got a case that you’re struggling to place with a mainstream lender, we’re on it!
Don’t believe me? Well, here are just three of the innovations we’ve introduced in recent years.
Since we launched it back in 2017, our top slicing feature has proved extremely popular with brokers looking for new ways to help their customers get the buy to let mortgage they need.
Top slicing allows customers to use surplus portfolio and/or earned disposable income to prove they can meet any financial stresses, rather than through the rental income of a new property alone. This could give them greater choice in the way they manage their properties, helping them to maximise investment opportunities and achieve greater flexibility around loan size.
Top slicing is available across our entire buy to let range on all eligible personal ownership, limited company, portfolio and HMO applications.
To find out more about top slicing, take a look at the blog I wrote about it earlier this year.
When the Prudential Regulation Authority (PRA) brought in stricter buy to let underwriting standards at the start of 2017, many PRA-regulated lenders chose to increase their interest coverage ratio (ICR) from 125% to 145%, whatever the case.
Here at Precise Mortgages, we adopted a different approach to maximise affordability and created bespoke ICR calculations which take every customer’s individual circumstances into consideration and optimise the performance of each applicant’s situation and ownership structure.
Want to know more about how our bespoke ICR works? Have a read of James Forth’s blog where he gives some examples to show how it works.
Affordability at pay rate
If you have a customer who’s concerned about affordability restricting their loan size, our 5 year fixed rate buy to let mortgages could be the answer. For these products, we assess affordability on the initial pay rate, rather than a stressed rate, which means your customer could be more likely to achieve the loan size they need.
Not only that, we no longer need to see evidence demonstrating that customers have substantial net worth, or satisfactory level of liquid assets, or excess disposable income.
To find out more about our reduced validation requirements, Steve Clark’s blog tells you everything you need to know.
All of this is great news for you and your customers. Not only could it make it easier for landlords to secure the buy to let mortgage they need, it could also make it quicker for you to place their cases, freeing up your time so you concentrate on doing what you do best – helping as many people as possible.
The products and/or services featured in this communication are not regulated by the Financial Conduct Authority and the Prudential Regulation Authority.