Monday, February 15, 2010

….because borrowers are not paying over the rent for their mortgages!!

Lenders tighten ‘consent-to-let’ rules....

Mortgage lenders are making it more difficult for borrowers moving home to keep an existing property and let it out. Many are charging higher rates and fees, with some lenders refusing their consent at all, brokers warn.

Posted by magnaman @ 11:52 AM (1413 views)
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6 thoughts on “….because borrowers are not paying over the rent for their mortgages!!

  • “many borrowers who want to move home do not want, or cannot afford, to sell while property prices are depressed” – now I’m really confused the FT reports “prices are depressed” whilst the Express reports prices are up £7k in just one month !!

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  • I think this is a prop that is important. This indicates lenders increasing nervousness, and will make ‘reluctant landlords’ either stay put (fewer bullish EAs) or sell at the prper market rate, with no option to wait for a better price.
    I also feel it will free up more homes to buy, increasing supply of course, and reinforce downward pressure on whole chains.
    It’s a pity this notion of reluctant landlordship was not made to pay it’s real cost to the disruption to true market values, through some sort of levy…..but then again the whole BTL scandal should have been culled at birth.

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  • braindeed @2

    Agreed, though I’d venture the deleted post @3 didn’t 😉

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  • If banks refuses these consent to let and owners cannot afford to pay the mortgage, what will happen ? There will be more and more reposessions and prices will tumble down. Good for thsoe who want to buy cheaply but bad for the banks.Why are they doing this ?

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  • tenyearstogetmymoneyback says:

    Oh deary me. How terrible.

    Having to arrange the sale of one house before you buy another.

    Back in the Good Old days there used to be a thing called a bridging loan, with an interest rate high
    enough to strike terror into anyone moving house

    More seriously if you borrow three times salary on two houses then you don’t need GCSE maths to realise
    that means you owe six times salary and are twice as exposed to any price drops etc.

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  • This is the first FT article posted here that I clicked on and went straight to it, rather than having to search for the title and go from a google link to avoid the ft block.
    Very decent of you magnaman, if this was you.

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