Jump to content
House Price Crash Forum
Sign in to follow this  
bobed

Buy-to-let Landlords Deserve Our Help

Recommended Posts

http://www.lovemoney.com/news/the-property...?source=1000020

Buy-to-let landlords aren't greedy, money-grabbing villians - they're victims of an unfair system and they deserve our help, argues John Fitzsimons.

Is there a bigger pantomime villain than a buy-to-let landlord? The mere sight of such an investor is liable to prompt boos and hisses from a British public currently enjoying a large dollop of schadenfreude at landlords' current troubles.

There may be trouble ahead

And they certainly do have a lot of troubles.

Just last week, research from the BBC suggested the repossession situation with buy-to-let properties is far worse than it seems, as the official figures do not include certain cases.

Rather than go through the official channels, a lender can instead appoint a receiver of rent, who replaces the landlord in taking the rent and passing it on to the lender.

When you take those into account, there have actually been 4,100 buy-to-let repossessions in the first quarter, more than double the official figure of 1,700.

And now the Council of Mortgage Lenders has published guidance for buy-to-let lenders when their borrowers fall behind on payments, emphasising lenders must act fairly and take individual circumstances into account before repossessing.

It described Government plans to legislate the repossession of rental properties as "sketchy", and with that legislation unlikely to be in place before 2010, the Council is clearly a little worried that certain lenders will take advantage.

We need a strong rental sector!

Our blasé attitude towards the plight of landlords is not a good thing.

Too often we overlook the fact that a strong rental sector is essential. Home-ownership is not a right, nor is it right for everyone.

And while the social rental sector does a good job, I think it is vitally important to have an equally strong private rented sector, to help take the pressure off the state. The private rented sector has also been a great success in improving the standards of rental properties.

Landlords are getting a rough deal

Whenever the topic of an owner-occupier being repossessed is raised, there is always a lot of handwringing, and calls for that person's individual circumstances to be recognised.

Perhaps they have lost their job, or their partner has upped and left, and that's why they have fallen behind on their mortgage payments.

However, landlords are never afforded the same luxury. If they fall into arrears, it is automatically because they over-extended themselves financially, they were greedy or they took too big a mortgage.

Yet research from the National Landlords Association in March found that 37% of landlords currently have tenants behind on their payments. Indeed, over the past six months, around 44% of landlords have at some point had tenants in arrears.

That's not the fault of the landlord, and yet because of those missed rental payments, they may fall behind on their own mortgage payments, putting them at the mercy of the lenders.

What's more, the lenders know that they even have the law on their side.

I fought the law and the law won

Back in November, a ruling at the High Court affirmed the right of lenders to take advantage of the Law of Property Act (1925), which allows them to take possession of a property without explicit permission of a judge after just two missed payments.

A Private Members Bill has been introduced in Parliament to try to amend this law, but we are still at the reading stage, so it will be a while before it can come into law.

And while lenders are unlikely to risk the inevitable public backlash that would follow utilising the law on an owner occupier, there is no such hesitancy with a buy-to-let mortgage.

Indeed the case that prompted the ruling was the repossession of a buy-to-let property!

A Landlord Mortgage Support Scheme?

So what should be done? Personally, I like the idea of a buy-to-let version of the Homeowner Mortgage Support Scheme.

Under the current scheme, mortgage owners are able to defer interest payments on their mortgages for up to two years.

Why not extend this to buy-to-let landlords? It would mean that they could afford similar breathing space to their tenants, if they are also struggling with their payments.

And it's not like such an extension will somehow damage the scheme - so far, the scheme has only helped two owner occupiers!

Landlords on the whole do a great and invaluable job, and our property market needs them - there are currently more than one million buy-to-let mortgages in place.

That's a lot of landlords at the mercy of circumstances beyond their control, just like normal homeowners.

Yes, they might make a bit of money out of it - and good luck to them if they do - but right now I think they also need our help.

Share this post


Link to post
Share on other sites

Poor landlords.

I cried so much I couldn't finish the article.

(Or perhaps it's hayfever and I just don't give a t*ss.)

Share this post


Link to post
Share on other sites
eusa_boohoo.gif

Hey !!

My computer doesn't have one of those.

(It has now.)

Share this post


Link to post
Share on other sites

However, landlords are never afforded the same luxury. If they fall into arrears, it is automatically because they over-extended themselves financially, they were greedy or they took too big a mortgage.

Yet research from the National Landlords Association in March found that 37% of landlords currently have tenants behind on their payments. Indeed, over the past six months, around 44% of landlords have at some point had tenants in arrears.

That's not the fault of the landlord, and yet because of those missed rental payments, they may fall behind on their own mortgage payments, putting them at the mercy of the lenders.

Isnt it totally the fault of the landlords? Thats why most mortgage lenders now insist on rental incomes covering and exceeding payments by a considerable margin?

If its not the landlords duty to cover for voids and late payments, then whose is it?

Theyre not just greedy, theyre stupid as well. Late and non-existent payments is just a part of business. Ask anyone who has dealt with Grant Bovey and theyll tell you that.

Share this post


Link to post
Share on other sites
Buy-to-let landlords aren't greedy, money-grabbing villians

Maybe not, but they are in business, and businesses sometimes fail

Trouble is, most of them couldn't get out of the mindset that it was a cutesy extension of their family home (hence all the no-pets, no-kids, don't mess up my carpets !!!!), and will now be incredulous when treated ruthlessly by lenders

Never mind, eh :lol:

Share this post


Link to post
Share on other sites
However, landlords are never afforded the same luxury. If they fall into arrears, it is automatically because they over-extended themselves financially, they were greedy or they took too big a mortgage.

Yet research from the National Landlords Association in March found that 37% of landlords currently have tenants behind on their payments. Indeed, over the past six months, around 44% of landlords have at some point had tenants in arrears.

That's not the fault of the landlord, and yet because of those missed rental payments, they may fall behind on their own mortgage payments, putting them at the mercy of the lenders.

Isnt it totally the fault of the landlords? Thats why most mortgage lenders now insist on rental incomes covering and exceeding payments by a considerable margin?

If its not the landlords duty to cover for voids and late payments, then whose is it?

Theyre not just greedy, theyre stupid as well. Late and non-existent payments is just a part of business. Ask anyone who has dealt with Grant Bovey and theyll tell you that.

Yeah that made me laugh too. It's not the fault of British Airways that not everyone wants to fly first class at several grand a pop. Lets bail em out.

Any BTL idiot that based their profit model on 0 voids or 0 arrears deserves everything they get. Though in reality that will be loads because their sums went like this

Capital appreciation - Mortage + rent = BMW X5 + free holidays forever what could possibly go wrong.

Share this post


Link to post
Share on other sites
That's not the fault of the landlord, and yet because of those missed rental payments, they may fall behind on their own mortgage payments, putting them at the mercy of the lenders.

Isnt it totally the fault of the landlords? Thats why most mortgage lenders now insist on rental incomes covering and exceeding payments by a considerable margin?

Quite so. Landlords are no different from any other business ... an unpaid/late invoice is their problem and shows that their business model isn't as viable as they hoped.

Share this post


Link to post
Share on other sites

(*Y9upb2P97go*"g(("&$&g$B&dgbd(p&vb

is what I think.

Expletives replaced with random letters.

Cheeky monkey vested interest moron.

More council housing. More affordable housing.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   292 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.