Foundation Home Loans has confirmed that it will continue to provide its range of competitive mortgage products to portfolio landlords ahead of new underwriting changes.
Foundation Home Loans Open for Business for Portfolio Landlords
The lender has outlined its portfolio lending proposition for intermediaries ahead of the 30th September 2017 deadline for the new Prudential Regulation Authority (PRA) underwriting standards.
Overall, there is very little change to the lender’s approach and underwriting criteria. Keeping the data requirement for background portfolios to a minimum, Foundation Home Loans will verify key data points electronically.
Background portfolios must have:
- A maximum aggregate portfolio loan-to-value (LTV) of 75% – this is calculated across the whole portfolio, including unencumbered properties.
- A minimum aggregate rental cover ratio will be 125% – stressed at 5.5%.
Intermediaries will continue to access Foundation’s existing products via its easy to use online system, where they can now upload details of the portfolio from a spreadsheet.
As before, borrowers may have unlimited background portfolios and finance up to £2m with Foundation. The lender provides a competitive product range for individuals and limited companies, and recently launched a House in Multiple Occupation (HMO)/multi-unit block product.
With Foundation’s products, there is no minimum income and no minimum period of employment or self-employment.
The Director of Marketing at Foundation, Jeff Knight, says: “Our research, undertaken amongst intermediaries and portfolio landlords, highlighted a need for a proposition that is simple and pragmatic – something that has always been at the heart of our approach. Therefore, we have not had to change much at all and will continue to provide a straightforward proposition to intermediaries.
“Indeed, portfolio landlords already represent around 50% of our business, so, unlike other lenders, this is very much business as usual for us and our intermediary partners.”
At the same time, the lender is increasing its maximum loan size across its buy-to-let range – a move made in response to increasing demand.
With immediate effect, the maximum individual loan size will increase to £1m for loans up to 65% LTV. For loans up to 75% and for HMOs, the maximum loan size remains at £500,000. There is no change to pricing.
Knight comments: “We have been receiving an increasing demand from intermediaries for larger loan sizes, so this is a simple move in response to that. As a growing specialist intermediary lender, we will continue to identify ways to expand our product proposition to the market.”