2016 buy to let mortgage criteria change – how could you be affected?

From 2016 buy to let investors are likely to be left needing large deposits to be able to qualify for a mortgage. For some this could mean the end of their buy to let investment dream. 

In addition to those who could struggle to make a buy to let purchase, there are those who already have a rental property who may find it a challenge to remortgage. This could leave many trapped with their current lender switching to a SVR.

Why is the face of buy to let likely to change?

Due to buy to let changes to be introduced in spring - including a stamp duty rise and increased market regulation, some banks are starting to tighten their criteria.

Already we have seen lenders such as Barclays announce changes. Barclays advises that mortgage applicants will need to show that they have 135% as monthly rent income against their monthly mortgage costs which is a 10% increase. This means landlords will either have to increase rents or borrow less.

In addition it is also being predicted that there could be a move towards 50% LTV buy to let mortgages which could remove many smaller investors from the running, they are likely to struggle to come up with a 50% deposit.

The advice in light of the changes that are due to come in, is to act without delay and get yourself a buy to let mortgage for 2016 as quickly as you can.

Search the market now through Deal Direct and let us find you a mortgage which can allow you to go ahead and invest in a rental property in 2016.

Why choose Deal Direct?

We are an independent ‘whole of market’ broker that can offer you independent advice and an entire UK market search. We are regulated to offer mortgage advice, but we cannot offer investment/financial advice.

If you want to discuss the suitability of property as an investment you need to call an independent financial adviser.

• Note: Currently not all BTL mortgages are regulated by the FCA.

For a competitive quote call 0800 048 8828.