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How to meet your clients challenges
UPCOMING EVENTS – REGISTER NOW
VIRTUAL WORKSHOP
Thursday 26th May 10-12:30pm
ESBS ASK THE EXPERT DAY
Thursday 9th June
GI HIIT SESSION
Friday 17th June from 10 – 11am
Bluestone
Right to Buy goes whole of market
We’re pleased to announce we’ve expanded our Right to Buy product range to the whole of market distribution to provide further support to a growing number of customers who do not fit the ‘vanilla’ profile.
Loans will be available up to 100% of the discounted purchase price and up to 75% LTV open market valuation. Loans will be available at a five-year fixed rate and accessible across all of our credit tiers.
We believe our duty as a specialist lender is to help those traditionally underserved, allowing them to achieve their homeownership dreams. And don’t forget, we reduced our entire product range rates yesterday across all credit tiers – by up to 1.57%.
To find out how we can help with your customers, you can call us on 0800 368 1833, request a callback or check your cases on Bluelink here.
LV= Equity Release
Changes to the LV= lending criteria
From 20 May, the following changes will be made to the lending criteria for LV= lifetime mortgages.
In summary:
- Our maximum flat roof percentage has increased from 50% to 100%.
- We will now be able to take a more flexible approach to properties in proximity to commercial/non-residential buildings.
Flat Roof
We have increased our maximum flat roof percentage from 50% to 100%.
We are happy to consider 100% flat roof where a durable material, such as asphalt, metal sheet, EPDM, GRP etc., is in place and the roof is in good condition. Our maximum percentage where the flat roof is constructed from felt has increased from 30% to 50%.
Ex-local authority properties are subject to a 50% maximum flat roof, regardless of the construction material used.
Commercial/Non-Residential Proximity
We will now be able to take a more flexible approach to properties in proximity to commercial/non-residential buildings. Non-residential properties, such as schools, places of worship, healthcare premises, care homes etc., may be permitted where adjacent or in close proximity to the subject property and subject to a satisfactory valuation.
For properties in close proximity to commercial premises e.g. pubs, shops, restaurants, offices, petrol stations etc. we are happy to consider these subject to surveyor comments. Please note that we are still unable to accept a property which is adjacent to or above commercial premises or in close proximity to a large-scale industrial site.
When submitting an application through our Equity Release Portal, there is already a question which asks whether the subject property is within 50m of commercial premises. If this is the case, you should answer this question appropriately and provide any relevant additional details in the notes section on the decision page. This will then be reviewed by our Underwriters before the valuation is instructed.
For more information, contact the LV= Equity Release team:
Call: 0800 028 8974 (option 1)
Visit: www.lvadviser.com/equity-release
Email: equityrelease.sales@lv.com
Marsden Building Society
Expanded Our Expat Countries List
We’ve further enhanced our proposition for your Expat Residential and Expat Buy to Let clients by expanding our list of acceptable countries. We’ve made this change to support more of your UK nationals looking to purchase a property in the UK for residential or investment purposes. To make this change as clear as possible we have put a handy list together of the countries we do not accept*. So if you have an Expat client who doesn’t reside in one of the below countries we will consider it!
Click here to view their full list of countries.
A few reminders about our expat mortgage ranges…
- For Expat Residential cases, your applicant must be paid in one of our approved currencies – please visit our website for further details.
- For Expat Buy to Let, we have no currency restrictions for cases passing our rental stress calculation.
- We have Expat Residential products available up to 85% LTV on repayment.
- We have Expat Buy to Let products available up to 70% LTV on repayment or interest only.
Got a case in mind?
We’re here to answer any questions you may have, or if you’ve got a case in mind, we’re happy to discuss it with you, just get in touch.
*List correct as of 19/05/2022. Subject to change.
Impact Specialist Finance
Bridging rates fall to new lows as volumes rise in first quarter
Contributor gross bridging lending hit £156.78 million in Q1 2022 as interest rates fell to historical lows, according to the latest Bridging Trends data.
Key data points from Bridging Trends Q1 2022:
- Annual contributor gross bridging lending up 8.5%
- Average monthly interest rate hits historical low
- Property purchase activity drives bridging market
- Regulated lending transactions soar
2022 has kicked off to a strong start with Bridging Trends contributors reporting a total of £156.78 million in bridging loan transactions in the first quarter of the year- 8.5% higher than in Q1 2021 (£144.51m), and up 7.8% on the previous quarter (£145.42m).
According to the data, more borrowers turned to bridging finance in Q1 to help unlock property transactions, allowing them to meet deadlines and utilise the flexibility bridging is known for.
For the fourth consecutive quarter, the most popular use of a bridging loan was to purchase an investment property, accounting for 26% of all loans in Q1 2022, down from 29% in the previous quarter.
The competitive nature of the property market was highlighted by the second most popular reason for bridging finance in Q1 – funding a chain break. Trying to get property purchases moving accounted for the greatest increase in demand for bridging, jumping to 23% of all lending, from 18% in Q4 2021.
Borrowing was also cheaper in Q1 as the average monthly interest rate on a bridging loan fell to a historical low of 0.71% in the first quarter of 2022, down from 0.77% in Q4 2021.
This drop in pricing is driven mainly by the boost in regulated lending over the past three months as demand for regulated bridging loans increased for the first time since Q1 2021. The number of regulated loans conducted by contributors increased to 43.9% in Q1 2022, compared with 36% in Q4 2021.
The spike in regulated bridging activity translated into lower loan-to-values (LTVs), with the average LTV in Q1 decreasing to 54.5% from 57.3% the previous quarter. Decreases in LTV could be down to the rise in asking prices.
Due to more purchase transactions over the quarter, the volume of second charge bridging transactions dropped- falling to 11.9% of all loans during Q1 2022, from 17% in the previous quarter and 22.2% in the same period last year.
Elsewhere, the average term of a bridging loan remained at 12 months during the first quarter. A completion time of 53 days during Q1 2022 was lower than an average completion time of 56 days during Q4 2021.
Dale Jannels, MD, impact Specialist Finance comments:
“This latest Bridging Trends highlights more than ever that cash is king. This applies to homeowners wishing to get their offer accepted before they have sold their own property, as well as investors wanting to raise funds quickly to invest in stock or refurbish existing to achieve better yields for example.
“The shortage of suitable housing stock will undoubtedly drive increased volumes in the bridging sector for the foreseeable future.”
Mansfield Building Society
Case Study: Limited Company Holiday Let with lending into retirement
Here at the Mansfield, we assess each application on its merits, which means we can make common sense lending decisions. In this case study we helped a limited company with two shareholders purchase a property over a term that extended into retirement when there was an historic credit blip.
The property was a 4 bed end terrace located in Suffolk and valued at £787,500. The company was looking to take out a loan of £400,000 meaning just under 51% loan to value (LTV).
The limited company had two shareholders aged 59 and 56 at the time of the application and with a loan term of 25 years, this would take them to age 84 and 81 at the end of the term.
The main shareholder was self-employed whose income was assessed on a nominal salary and annual dividends, we also had to consider a current residential mortgage as an outgoing for this applicant. The second shareholder had a minor missed payment on a phone plan over 3 months ago and we could see that there were no further adverse payments since.
Rental income was flexibly assessed with low season expectations at £889 per month, mid-season at £1,015 per month and high season at £1,499 per month.
With a 5 year fixed rate product chosen, we were able to flexibly accommodate circumstances requiring lending into retirement and an historic credit blip together with providing certainty of mortgage repayments costs for the next 5 years.
A common sense approach
If you’ve got a case on your desk that requires a common sense approach to lending then please pick up the phone to our Broker Support team on 01623 676360 or visit https://www.mansfieldbs.co.uk/intermediaries/.
LV= Protection
In 2021 LV= paid out more claims than ever before
While you hope your clients will never have to claim on their Protection policy, it provides peace of mind to know that, should they need to, they’re supported by a provider who cares. LV= supports your clients at each step, from the moment they take out their cover through to those life-changing moments.
In 2021 LV= paid more in claims than ever before, but behind that figure are the real ways that protection has made an impact to people’s lives. The LV= Claims report this year includes many case studies, details of their process and how you can highlight the value of protection to clients.
You can read the latest report here.
For more information please contact your LV= Account Manager, visit LVadviser.com or call 0800 032 4219.
Lendinvest
Case study: Fast auction purchase against tight deadline submitted through portal
What does it take to deliver a bridging deal quickly?
LendInvest Underwriter Courtney Keegan walks you through a recent deal where a borrower had purchased a home at auction but needed fast funding to secure the property and fund light refurbishments to make it into her first Buy-to-Let.
Find out more here.
The Mortgage Lender
The Lowdown on Buy now, regret later
There’s something pretty irresistible about interest-free credit. Over the last year or two, the buy now, pay later (BNPL) market for online shopping has exploded. Unfortunately, that’s meant compromised credit scores and people who are now finding it hard to get mortgages from the high-street lenders.
The good news is that we have solutions. And we’ve written an article all about the BNPL phenomenon, covering:
• The history and growth of BNPL
• The pitfalls for customers
• What the government plans to do and when
• How you can help your clients now.
Get up to speed on BNPL by reading the full article here.
Legal & General Protection
Announces record claims statistics
In 2021, Legal & General paid out over £797 million in individual protection claims supporting 16,890 customers & their families. They also supported families who lost loved ones due to factors attributable to Covid-19, paying out over £73 million in Life Insurance* claims to 1,579 families.
Visit their designated claims page today to find out more about:
- Claims statistics broken down by product, age and region
- Top reasons for declined claims and how to avoid misrepresentation
- Hints and tips on speeding up claims
- Recent improvements made to support you and your clients
Find out how you can support Legal & General pay more claims by visiting their designated claims page today.
*Life and Over 50’s Life Insurance
The Family Building Society
JMSO – A family solution to boost affordability
Our Joint Mortgage Sole Owner arrangements offer a family solution to affordability. You may have always thought of it as a way for parents to help their children onto the property ladder or financially assist them with renovations.
But did you know JMSO can also be used by adult children to help their parents with affordability in later life? It can be great way to enable parents to stay in their family home for longer without the need to downsize.
Benefits of JMSO
- Up to four incomes can be used for affordability – one or two borrowers (who will own and occupy the property) can be supported by up to two other family members
- Supporting family members will not be liable for stamp duty on a second home – they will be listed on the mortgage but will not own the property.
Who is it suitable for?
- Adult children helping their parents borrow in later life
- Parents helping their children buy their first home, step up the property ladder or help with renovations
- Couples with a Buy to Let property where the owning partner does not have sufficient income of their own.
- Restricted to parents and adult children and cannot be used for grandparents or other family members
Generous age limits apply
For JMSO mortgages our standard generous age limits apply for the main (occupying) borrowers.
- Owner Occupier JMSO mortgages:
– Repayment mortgages, up to a maximum age of 95 at the end of term
– Interest-Only up to a maximum age of 89 when the loan commences
– Up to 80% LTV - If your client needs a Buy to Let mortgage, they can apply for a JMSO arrangement on our standard product range:
– Maximum age of 89 when the loan commences
– Up to 70% LTV. - If any of the loan is on an Interest-Only basis, the mortgage must finish before either the expected retirement age of the eldest supporting (non-occupying) borrower or by age 70, whichever is sooner
FIND OUT MORE and see how we can help your clients.
To contact our Mortgage Desk or your local BDM;
CALL US ON: 01372 744155
OR EMAIL: mortgage.desk@familybsoc.co.uk
THE MORTGAGE LENDER
Exploring Adverse Credit
We’ve conducted some research and published an in-depth report on adverse credit, what it means for mortgage applicants and what brokers can do about it. The results surprised us and we’d like to share our findings some from the survey and social creative for you to utilise with your advisors and it you see fit on your channels with a deep dive into Credit Scores.
Findings include;
- 62% of UK adults do not know what their credit score is
- 10% of Britons say their credit score has worsened since the pandemic
- Fewer than one in five (18%) have taken steps to improve their credit score
Foundation Home Loans
Exploring the HMO options in Spring 2022
HMOs continue to be a strong option for professional landlords who are experienced in dealing with this property type or who have a support network in place to manage their extra demands.
The continued appeal of HMOs is evident in the strength of the yields on offer, as highlighted in the Q1 2022 Landlord Panel research from BVA BDRC. The data showed that landlords with HMOs continue to achieve the highest rental yields, at an average of 6.8%. (slide 24) In terms of tenant types, migrant workers currently provide the strongest yields at 6.8% on average.
Just
Equity release hints and tips to help avoid underwriting issues
It’s easy to assume a property is an obvious candidate for equity release lending only to discover a vital aspect has been overlooked.
Join Equity Release Specialist, Malcolm Tyrrell in this new webinar and learn the underwriting issues to be aware of when considering a potential lifetime mortgage.
KENSINGTON
INNOVATIVE MORTGAGES THAT MEET YOUR CLIENTS’ NEEDS
Alongside flexible lending criteria, our team of underwriters look beyond the tick boxes of an application form. We use real data to create innovative mortgages that meet the needs of real people, those the high street lenders can often overlook.
If you’re looking for a mortgage lender that looks for ways to say yes, rather than no, register for access to our broker portal. You’ll then be able to place cases with us, and sign up for our latest updates so you’re first to hear when we launch new products and services.
