Boost for buy-to-let mortgages

by Morag Lyall

For those who are keen to purchase a buy-to-let property, Mortgage Works has said that it is to increase the maximum loan-to-value on its products to 80 per cent.

Previously the level was set at 75 per cent.

Lee Grandin, managing director at Landlord Mortgages, commented: "It is very good news that we are able to put a bit more confidence back into buy-to-let.

"To move the goalposts to 80 per cent is a fundamental shift in lenders' attitudes to risk."

Mr Grandin warned that this news could encourage more landlords to widen their property portfolio and increase the competition in the market and he expected that other lenders would also follow suit.

According to Bank of England figures released this month, the number of new mortgage approvals increased to 48,901 in March, compared to 46,882 the month before.

However, this rate is below the previous six month average, which stood at 54,201.

Landlords could take advantage of creating their own tenancy agreements and property inventories to further cut the costs of adding properties to their portfolio.

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Published on: May 11, 2010

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