It believes this is a sign that they are targeting professional landlords who are continuing to remain active in the marketplace.
In the past three years the standard practice was for buy-to-let lenders to design mortgages at 85% loan to value, requiring a 15% deposit which has encouraged many smaller portfolio investors into the market. However the reaction to the credit crunch has meant higher perceived risk and a more cautious approach requiring larger deposits.
Jonathan Moore, head of marketing at Mortgages for Business commented: “Most lenders are now looking for deposits of between 20% and 30% depending on the property and / or tenant type.
“There are still 15% deposit requirement mortgages available however they are now in the minority which is surprising news to many investors when they come to make a purchase or remortgage.
“We are also starting to see differentiated loan to value pricing, with those investors with a smaller deposit having to choose a mortgage with a more expensive headline rate or larger arrangement fee.”
The change in deposit requirements further demonstrates the shift that lenders are targeting products at professional landlords who have larger portfolios and continue to remain active in the marketplace, according to Mortgages for Business. Increasingly these landlords are able to exert pressure on purchase prices and continue to make purchases.
