Inform 30th September 2022

To calculate the percentage loan to value (LTV) when a product transfer (PT) is required, we use an indexed valuation figure which is updated every quarter by the Halifax House Price Index (HHPI). Ahead of the next changes to HHPI, in October, we’re sending you the usual reminder that our online PT process allows you to produce an instant quote and illustration for your client, however the process does not allow you to save an application and resume.

If the illustration is not progressed through to offer, any future changes to the HHPI may negatively or positively impact on the LTV and therefore product(s) available.

To ensure the product is secured for your client, a PT application must be progressed through to offer.

From Monday 26th September Aldermore will be allowing Product Transfer’s to switch products up to 17 weeks before their current rate or Early Repayment Charges (ERC’s) end.

Find out how to switch your clients products online here.

We know a number of you have pre and post offer applications with us that are due to expire on 3 October.

In this uncertain rate environment and with 3th October almost upon us, we may be able to provide an extension to your pre and post offer applications, depending on its status. This is explained in more detail below:

Have you yet to receive a mortgage offer?

• Cases in a pre-offer state can now enjoy the same 13-week application validity period we now apply to new cases; any offer issued will then be valid for 9 weeks from the date the offer is issued.
• If your case has already had 13 or more weeks since submitting the application, we will not be able to offer an extension.

Have you received a mortgage offer?

• Post-offer cases will be allowed a minimum of 9 weeks from the date of the original offer to complete.  This means extensions will be granted to any case where the time between your offer date and the original 3 October deadline is less than 9 weeks;
• However, any post-offer case which has a current deadline of 3 October, and the time between the offer and 3 October is already greater than or equal to 9 weeks cannot be extended. These cases will have to complete by 3 October.

Please note the above relates only to the following products:

• XF0493 to XF0520 & XFZ011 and
• XF0521 to XF0548 & XFZ012

Important note:
If your current post or pre offer case is not able to be extended for the reasons outlined above, you will be able to choose from our range of variable discounted products.

From Monday 3 October this range will also include new products for owner occupier repayment and limited company buy to let, alongside the products we currently have on-sale, which means we will have a variable option for all of your cases.

To help you and your clients in this time of market volatility, for a limited time, our discounted products will enable your clients to complete on their purchase or remortgage in 2022 and then switch to a FBS fixed rate product, without ERC, when they become available. More details will follow on Monday 3 October.

We have a team of BDMs ready, willing and able to answer any of your queries. If you don’t have a BDM in your area, you can contact our dedicated Mortgage Desk.

The clients were an expat couple living in Switzerland. They owned two AST Buy to Let properties in the UK and were looking to make their first UK holiday let investment.

The situation
The holiday let property was based in the North of England near the popular holiday location of the Lake District. The yields were promising and so the couple were looking for a lender who could take into account their existing letting experience in the UK so they could purchase the property.

The solution
Castle Trust Bank provided a TermTen loan at 75% LTV, fixed for 2 years at 4.61%. This gave the clients the opportunity to purchase the property in a popular location and make the most of the growing UK holiday market.

Take a closer look at Castle Trust’s latest product guide which is available through Impact Packaging.

Have a case you would like to discuss? Call the impact packaging team now on 01403 272625.

As of today, (Tuesday 27th September 2022) Foundation Home Loans are pleased to announce that they have updated their credit criteria in order to continue to meet our target borrowers’ evolving needs by being able to accommodate the additional credit blips and instances which may have occurred in recent years.

Foundation have also introduced a new F4 tier to open up their products to a broader group of customers and deliver additional options that they may not have had access to previously.

The new range provides a greater number of product options for the borrowers who have an impacted credit score and have experienced more recent life events, but have shown they are able to make their mortgage payments.

The F1-F4 range includes:

• Enhanced credit criteria and all new F1-F3 product range
• New range of F4 credit tier products up to 75% LTV
• New 75% LTV Green EPC A-C
• Professionals range at 75% LTV

For some borrowers, the realignment of permitted credit events in each tier means that they may be offered a better product than they may have before the change.

George Gee, Managing Director (Commercial) at Foundation Home Loans, said:
“As part of the development of this product proposition, we analysed thousands of credit points on data that represented the current owner occupier mortgage market and we believe that, with this broadening of our criteria, we are able to cater for more than 85% of residential borrowers that may need a specialist solution.”

At Foundation, you can now find a home for even more of your near-mainstream borrowers who have had recent issues due to events in the past few years.

Download product guide

What is a Multi-unit Freehold Block?
A multi-unit freehold blocks (MUFB) is a single freehold property which has been split up into multiple self-contained units. Each unit will have separate entrances, kitchen, and bathroom areas, and they can have shared areas such as hallways and outdoor spaces.

Some common examples of an MUFB include, a purpose built blocks of flats and houses converted into flats.

What are the differences between a HMO and MUFB?
The main differences between HMOs and MUFBs are that MUFBs are self-contained units that have individual AST agreements in place and separate entrances, kitchens, and bathroom spaces.

Houses in multiple occupation (HMOs) are residential properties that are shared by 3 or more people, from at least 2 or more households. The tenants have individual rooms but share facilities such as a kitchen, communal rooms, or bathroom.

For more information on HMOs and the benefits of having one, click here.

Benefits of a MUFB

• High rental yield – Having multiple tenancies increases potential income opportunities compared to single occupied properties. Generally, a MUFB will have a higher rental yield than a traditional single occupancy buy-to-let property.
• Lower risk of Void Periods –As there are multiple tenancies running during the same period, the loss of a tenant will not be as detrimental in comparison to single-unit buy-to-let properties. Although the landlord will experience a dip in income, the landlord will still receive rent from other units within the MUFB.
• Units can have separate titles created – Landlords may decide to split the titles of individual units and sell each unit individually.
• No License required – Unlike HMOs, MUFBs do not require licenses meaning landlords do not have to worry about any required fees or set up charges with the local authorities.

Challenges for a MUFB

• Considered complex by investors –Finding finance can be challenging as there are a limited number of mainstream lenders willing to provide the funds for MUFBs. This is because they are considered as complex investments.
• Converting single-occupancy property – Converting single-occupancy properties into MUFBs can be time consuming. In addition, landlords may also need to obtain planning permission which will cost time and money.

As a result, landlords may need to wait some time before they can start letting the units and making profit.

• Maintenance costs can build up – Managing MUFBs can be costly, and landlords must be prepared to cover any maintenance costs, especially in the event that multiple units require funding.
• MUFB market is limited – There are a limited number of MUFB investors, and it may be difficult to sell these properties in the future. This should be carefully considered before choosing to invest in an MUFB

For more information on our MUFB product range please get in touch with the West One team now.

T: 0333 123 4556
E:  BTLbrokersupport@westoneloans.co.uk
W: https://www.westoneloans.co.uk/contact

Leek have had different names since they started supporting local people to save and buy homes almost 160 years ago, as of 1st October, you might notice a small change to our name as Leek United drop the word ‘United’ and become known as ‘Leek Building Society’.  They will be updating their website URL to www.leekbs.co.uk and intermediary pages will be www.leekbs.co.uk/intermediaries you may also notice our email addresses change to @leekbs.co.uk.

While you might see a slightly different name when you see their products, you can be assured that nothing else has changed. Leek are very much still ‘united’ with members!

We’re absolutely delighted to announce the winners of the Just Group 2022 Vulnerable Customer Awards.

The Just Group Vulnerable Customer Awards is in its second year, and once again we haven’t been disappointed by the quality of entries. So thank you to everyone who took part. It’s been an absolute pleasure reading all the submissions and learning of the depth of activity, policies and procedures and collaborative work in place to support vulnerable customers.

Find out who they are here.

Did you know that Income Protection Awareness Week is next month and runs from the 17^th to the 21^st of October. Join the Income Protection Task Force and a range of networks and providers to discover lots of great online content.

From looking at the need for income protection to hearing stories from advisers around how and why they make income protection part of their process.

There’s even a session hosted by our very own Shelley Read – Senior Intermediary Development and Technical Manager.

Visit the Income Protection Task Force website to register for each day you want to attend.

The next few weeks will be extremely busy as unprecedented numbers of customers look to switch mortgage deals.  In this update, we share what we’re doing to manage cases over this period and how you can help:

1. Late September and early October penalty cases – what to expect 

We’ve identified every case where we have so far been advised that the current mortgage deal ends at the end of September/early October and the customer doesn’t want to pay any early repayment charges. We’re working hard to get everything ready to complete after the charges expire and will send you an update as key milestones are achieved.  Please do not contact us.  During this busy period, we’ll be unable to take your call as we prioritise customer calls.

2. The Redemption Statement

To complete the remortgage we need a Redemption Statement from the existing lender that doesn’t include any early repayment charges. In this respect not all lenders are the same. Some lenders will only issue a Redemption Statement without these charges after they have expired. Others will issue a Redemption Statement without these charges before the current deal ends. We have diarised each case to request a Redemption Statement as soon as we can, relevant to the existing lender’s requirements.

3. Getting ready to complete

We’ll let each customer know if we need anything from them. You can help by asking them to return any documents immediately and use the portal to track progress and make any payments. We’ll be in touch as soon as everyone and everything is ready to complete.

Important. Whilst we cannot guarantee completion on specific days, we will aim complete as soon as we can. However, we must allow for the new lender’s funds request period and receipt of a suitable Redemption Statement before we can set a completion date.

To calculate the percentage loan to value (LTV) when a product transfer (PT) is required, we use an indexed valuation figure which is updated every quarter by the Housing Price Index (HPI). Ahead of the next changes to HPI, in October, we’re sending you the usual reminder that our online PT process allows you to produce an instant quote and illustration for your client, however the process does not allow you to save an application and resume.

If the illustration is not progressed through to offer, any future changes may have an impact on the application, for example:

• Changes to the HPI may negatively or positively impact on the LTV
• Products may be withdrawn as part of a rate change.

To ensure the product is secured for your client, a PT application must be progressed through to offer.

Despite the recent changes in the mortgage market, we still have fixed rates available across our full range of products.

Fixed rates available on:

– Second charge mortgages;

– Complex buy to let;

– Specialist residential mortgages (remortgages and purchases);

– Bridging loans;

– Commercial and Semi-commercial mortgages;

– Development finance.

Help your clients achieve their goals and call our friendly team today! We’re always happy to speak with your client directly, allowing you to focus on your core business.