How’s your buy to let mortgage?
September is coming……….
I know what you are thinking, “Yes it comes every year after August and your point is?”
Well if you have a buy to let mortgage on a fixed rate deal then you need to know that September is coming because it signals a major shake-up in the buy to let mortgage rules.
With the new tax regime for buy to let landlords in the process of being phased in, mortgage companies are looking at the mortgages on their books and beginning to worry. So in September new stress test rules are being introduced that will affect not only new mortgages but also fixed rate mortgages that are coming to the end of their fixed term.
Who will be impacted and how?
This is likely to adversely affect small portfolio landlords, usually landlords with 4-10 properties. Put simply if you have multiple buy to let mortgages on various properties and one of the mortgages fixed rates is coming to an end, the relevant mortgage provider will not just stress test that property they will stress test all your buy to let properties and will make a judgement based on the whole portfolio.
Initial indications are that mortgage providers are going to be looking to rationalise their buy to let lending and are particularly worried about their exposure with small landlords with numerous mortgages. You could be paying a lot more or worst case scenario be forced to sell some or all of your properties.
Further information and advice
So what do you do if this could affect you?
Firstly don’t panic. If you have a fixed rate mortgage that expires within the year then you still have time. Talk to our trusted mortgage partner Ian Stuart and he will look at your situation and get you the best new deal before September. Contact Ian at Ian@ianstuartmortgages.co.uk or 07888 838843