Specialist Buy-to-Let
Earlier, we shared a post titled “Dispelling the Myths of Specialist BTL | Exclusive Week 3,” and today, we aim to build upon the same theme.
Distinguish truth from fiction with specialist Buy-to-Let lender West One and seize the chance to win an opulent hamper! West One invites you to participate in their complimentary prize drawing for an exquisite hamper from Fortnum and Mason.
Participating is a breeze – peruse the article provided below and respond to a straightforward query on the West One website to secure your entry into the contest.
In the aftermath of the pandemic, a surge in borrowers with intricate financial needs is anticipated, posing a challenge for mainstream banks to accommodate. This scenario is a substantial opportunity for the specialised lending sector to play a pivotal role in supporting the 2.7 million landlords across the UK.
Often viewed as a last resort, specialist lending is a perception that the specialist buy-to-let team at West One is fervently committed to dispelling. Here, we embark on the journey of unravelling reality from misconceptions, shedding light on the untapped potential within the specialised lending landscape. So, take a moment to delve into the details and broaden your understanding of this evolving market. By doing so, you gain valuable insights and stand a chance to win a luxurious hamper that could elevate your indulgence to new heights.
Specialist Buy-to-Let | Myth Number 1
One prevalent misconception revolves around the perceived complexity of specialised finance. Despite the intricacies that may arise in individual cases, the overall procedure remains straightforward.
A proficient financial institution specialising in this field possesses the essential resources to conduct thorough assessments. This involves meticulously examining each case individually to ensure a clear and easily comprehensible solution is presented.
Like mainstream banks, these specialised lenders boast a professional and efficient protocol. This enables them to give borrowers prompt responses, maintaining a swift and streamlined approach throughout the lending process. Furthermore, their dedicated focus on each case allows for tailored solutions, debunking the myth of undue complexity in specialist finance.
Specialist Buy-to-Let | Myth number 2
Apart from unfavourable credit history, various other factors contribute to the preference of specialised lenders over traditional high street banks for borrowers.
The nature of the property under consideration significantly influences the decision-making process of high-street lenders. Properties situated above or adjacent to commercial units are often perceived as high-risk, triggering concerns among lenders about potential challenges in achieving the anticipated rental income or maintaining consistent occupancy.
Moreover, high street banks tend to view properties designated as Homes of Multiple Occupancy (HMO), student lets, and multi-unit blocks cautiously, often categorising them as unsuitable for their lending portfolios. On the contrary, specialised lenders offer tailored products explicitly designed to accommodate the unique demands associated with these property types.
This distinction in approach underscores the importance of borrowers exploring alternative lending options beyond traditional banks, especially when dealing with properties that may not align with the conventional criteria set by high street lenders. In doing so, borrowers can access financial solutions better suited to their specific needs and property considerations.
There are several red flags for high street lenders when it comes to the profile of the borrower:
- The borrower’s age is typically capped at 70, whereas a specialist lender will consider applicants beyond this limit. West One, for example, has an entry age of up to 80, and a term of up to 25 years can be considered.
- Ex-pats often struggle to find a high-street lender offering them a buy-to-let mortgage. In contrast, a specialist lender can take a personal approach to underwriting and look at the individual’s circumstances.
- Many high-street lenders have to take a different approach to underwrite a landlord with more than four properties, taking the personal affordability of the portfolio into account. This means that professional landlords will need to look to a specialist lender if they wish to use just one lender.
- The purpose of the buy-to-let property can also impact a high-street bank’s decision to lend. Many high-street banks will not lend for holiday lets, Airbnb properties, or long-term corporate lets, whereas a specialist lender will have products specifically for these uses.
Specialist Buy-to-Let | Myth number 3
While most high-street lenders will make an automated decision based on your credit score, a specialist lender will have more products available for borrowers with adverse credit.
At West One, we do not have credit scores. Instead, our underwriting is based on a credit assessment, and each case is assessed individually on its merits.
Specialist Buy-to-Let | Myth number 4
Unsurprisingly, self-employed individuals find the high street hard, with many lenders requiring 2 years of accounts so that they can see a stable income and assess the level of risk.
This approach doesn’t consider the changing landscape of a self-employed business. A specialist lender will take the time to understand the individuals’ circumstances and can take a view on circumstances, including professional landlords whose sole source of income is their property portfolio.
Specialist Buy-to-Let | Myth number 5
High Street banks have increasingly moved to a more automated solution; while this works perfectly for low-risk and low-loan-to-value loans, it eliminates human interaction and can result in cases with a degree of complexity falling out.
A specialist lender that undertakes manual underwriting will be better placed to offer a solution for various cases.
Specialist Buy-to-Let | Myth number 6
The high street typically requires a minimum income of £25,000 for prospective specialist buy-to-let borrowers. However, a specialist lender will decide based on the income being enough to cover their personal expenditure. At West One, we have no minimum income requirement.
Specialist Buy-to-Let | Why West One?
We offer a wide range of buy-to-let mortgages to individuals, limited companies & LLPs. Our specialist underwriters apply an individual approach to underwriting to ensure we review each case on its merits and support clients with the smooth and secure purchase or re-mortgage they require.
- Great turnaround times from enquiry to application and offer.
- Max age on the application 80.
- First Time Landlords – HMO, MUFB & Holiday lets – No BTL experience required.
- Ltd Co lending with no rate loading.
- Ex-Pats living in EEA countries.
- Holiday Lets/Airbnb lending based on AST rental value.
- No credit scores.
- Late Mortgage payments paid within 30 days of the due date are ignored.
- Adverse – ignore blips under £350 & satisfied entries on W2 products.
- Inter-family sales – gifted equity and gifted deposit considered.
- No minimum income requirements or evidence is generally required.
- Day One Re-mortgages are based on the current value when work is completed.
- New build flats.
- HMOs up to 10 bedrooms.
- Long Term Corporate Lets & DSS/Student Tenants.
- Flats/House next to/above Commercial Premises.
- Studio Flats.
- Multi-unit freehold buildings.
- Ex-Local Authority Flats.
- Let to Buy and Consumer BTLs considered.
- Flexible approach towards portfolio landlords & no background portfolio stress test.
- Fast track re-mortgage options to speed up completions
Entries must be received by 5 pm on Friday 22nd October. We will be announcing the lucky winner on Monday 25th October!
Click here to enter.
We’ve come to the end of our publication on Specialist Buy-to-Let. Until next time, stay Connect!