Dispelling the myths of specialist buy-to-let
Sort the fact from the fiction with West One and win a luxury hamper! West One are offering you the chance to enter their free prize draw to win a luxury hamper from Fortnum and Mason.
It’s quick and easy to enter, simply read through the article below and answer a simple on the West One website to be entered into the drawer…
Post pandemic, there is likely to be an increase of borrowers that high street banks will be unable to serve as their borrowing needs have become more complex. This presents a huge opportunity for the specialist lending market to step in and support the UK’s 2.7 million landlords.
Specialist lending has sometimes been thought of as a last resort, something the buy-to-let team here at West One are passionate about changing. Here we begin to separate the fact from the fiction…
Myth number 1
One of the biggest myths is that specialist finance is complicated, while the cases themselves may be complex the process isn’t.
A specialist lender will have the resources to do the necessary checks while looking at each case individually in order to propose a transparent solution that is easy to understand.
Like a high street bank, specialist lenders have a professional and streamlined process allowing them to deliver a quick answer to the borrower.
Myth number 2
Aside from adverse credit, there are a number of other reasons why a specialist lender may be a better option for a borrower than a high street bank.
The type of property that the buyer is looking to borrow on can affect a high street lenders decision.
Properties above or next to a commercial unit may be considered high risk as the lender may worry that the property will either fail to deliver the expected rental price or to be consistently rented out.
Homes of Multiple Occupancy (HMO), student lets, and multi-unit blocks can also be considered no-goes for high street banks, while a specialist lender will have products specifically for these types of properties.
There are a number of red flags for high street lenders when it comes to the profile of the borrower:
- The age of the borrower is typically capped at 70, whereas a specialist lender will consider applicants beyond this limit. West One, for example, have an age at entry up to 80 and a term of up to 25 years can be considered.
- Ex-pats often struggle to find a high street lender that will offer them a buy-to-let mortgage, while a specialist lender is able to take a personal approach to underwriting and look at the circumstances of the individual.
- Many high street lenders have to undertake a different approach to underwriting a landlord with more than 4 properties taking personal affordability of the portfolio into account, which 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 banks 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.
Myth number 3
While most high street lenders will make an automated decision using your credit score, a specialist lender will have more products available for borrowers with adverse credit.
At West One, we do not credit score, instead our underwriting is based on a credit assessment and each case is assessed individually on its merits.
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 if their property portfolio.
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 cuts out the 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 a variety of cases.
Myth number 6
The high street typically requires a minimum income of £25,000 for prospective 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.
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, ensuring we 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 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 based on the current value when works 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.