A couple of weeks ago, as we all entered ‘lockdown’, most lenders reduced their product range and made some restrictions. They focused their energy on getting cases that had valuations completed and helping those in need of payment holidays. This has given them some time to think about their lending proposition going forward.

As we spoke about last week, lenders are starting to make changes to allow lending to continue through this time; I am sure we will start to see more of this. E-ID checks to avoid certification, independent legal advice via video call, and the removal of the requirement for witnessing all need to be considered to allow a mortgage to complete.

The major issue to contend with is valuations. Desktop valuations are something commonly used within the residential mortgage market, but we haven’t seen them take off within the specialist side of things. They do have their limitations, and that is why they often don’t work in this scenario; where properties need work completing or have just finished a refurbishment, HMOs, and flats above commercial property all fall outside of what a desktop can cater for.

What we have seen this week, however, is a number of specialist lenders turn to desktop valuations to allow mortgages to complete without a full valuation.

The first lender is a competitor within the vanilla end of the specialist market. They are allowing desktop valuations for standard properties up to 60% for purchases and refinances. There are some caveats; it needs to be a standard property, a single AST and there are some other property restrictions. It’s suitable for a limited company and personally owned properties though, with no outside minimum income requirements and rates start at 2.99%.

The other lenders are more commercially minded, so they can be more flexible around and property types and the purchase structure (although it still needs to be a single property on a single AST). We can stretch the loan to value up to 75% in some scenarios and rates start at 3.99%.

These lenders work well for more complicated transactions, so they can be flexible on the source of deposit, company structures, and outside income. We currently have a property with one lender which is a flat above a commercial unit, which many other lenders will not look at, so they are looking outside ‘normal’ properties.

We also have access to a number of bridging lenders who are happy to work with a desktop valuation up to about 50% loan to value depending on the case.

What we are seeing is that lenders are keen to keep going and find new methods of working, so if you have any deals you would like to talk through with us then please give Jackie a call to chat through your options. We are very much open for business and working with lenders who are the same!

In a time when we are all feeling quite vulnerable to this virus, imagine having a 2-week old baby and being told you need an independent witness to sign your personal guarantee? This is a client of ours who needs to complete this refinance as soon as possible, so the situation was increasing their anxiety levels more than somewhat.

As a broker, Baya really wants to keep our clients safe, I can’t think of anything worse than finding out she was ill as a result of getting the document signed.  With this in mind, I called the lender, Shawbrook, to see how they could help.  All through the current situation, I have seen that they are working away at how to change systems to accommodate the current challenges, and this is a great example that proves just that…

Lee Warne took my call. He listened to me patiently and empathised with the very real worries of our client.  It was clear that Shawbrook also did not want any risk to the client’s health, or her new baby.  After a week of working with their lawyers, Pure Law, they generated a one-off personal guarantee contract – WHICH DOESN’T NEED AN INDEPENDENT WITNESS. How cool is that – and no mean feat either.

We are all stressed at the moment, and a touch impatient as well.  In these times it is so important to have a broker who has your best interests at heart, as well as a lender who is prepared to do all they can to find a way around a tricky situation. Shawbrook said they would find a way, and they delivered as I believed they would.

Enjoy your weekend and stay safe.

Hello everyone, I hope you are all staying safe and sane – the latter being the most difficult I fear.

I thought this week’s blog should be something motivating, so I have written it about a case that completed yesterday.  It’s at times like this that believing you are in a safe pair of hands is the most important thing for us all.

The lender was Hampshire Trust Bank and the case was sitting with solicitors ready to complete at 75% LTV, which is high at the current time. I had a call from Alex Upton, Commercial Director, who had issues with the LTV given the current climate. The benefit of taking the time to call me and discuss their concerns meant a sensible solution could be easily and quickly achieved.

After discussing the merits of the case, we agreed on a 3 months retention of interest,  which was a very simple solution and the client was happy as they could keep the 75% LTV.  The updated formal offer was completed within a few hours, so no delays at all.  The lender and solicitors were excellent and communicative, therefore reducing the stress.  Thank you to those at Hampshire Trust Bank and Paris Smith that were involved in this.

All companies will be having to furlough some staff, including us, but I am holding the fort at Baya and still working on all cases.  I hope we can be called a safe pair of hands as well.

As always, if you have any questions please don’t hesitate to get in touch.

Hope you are all well and settling into your new normal. This week I thought I’d give you some ideas on what you can do while we are all at home and things have slowed down a little.

1. Take stock of what you have

Whether you’re a new investor or a portfolio landlord, it’s always a good idea to allocate some time periodically to assess what you have and whether it is performing well enough for you. This could be cash savings, property or any other investment. Now may not be the time to make any changes, but knowing what you have will allow you to assess your return on investment and know what is doing well and what maybe isn’t working well for you.

2. Spend some time learning

We have all (as a general rule!) got some more time on our hands than usual and although it is tough at the moment, we can use this time effectively to take our minds off other things.

There are so many online resources and the majority of them are free. We are the preferred partner of the Property Investors Network in Watford, and PIN is running an array of online courses so have a look on their website for details. There are plenty online, depending on what you are interested in learning about. It doesn’t have to be property-related directly, you may want to learn about remote working, time management, accountancy tools – the world is your oyster!

3. Alternative strategies

Once you’ve looked at your current portfolio, you may want to think about whether you want to move to different strategy. Could that be a different location, focus on a higher yield, a bigger project, or a smaller one to give a quicker income?

This is a great opportunity to carry out some market research on new strategies and areas. It’s a good idea to chat through your finance options too, so give us a call if you want to find out what is available and how it all works.

4. Networking!

This may seem like an odd one given the social distancing rules, but there are plenty of online places to network! There is a fantastic community on Instagram and LinkedIn among other places. PIN has moved a lot online and are hoping to have some online networking events. Now we do have a bit more time, why not engage in conversations with people you follow or arrange a chat with them.

If you’re a regular at networking events, there may be a pile of business cards that you haven’t got round to contacting, so is this a good time to do that? Arrange a chat and coffee over Zoom and use this time to do the things you don’t usually have time to do!

5. What’s your next move?

We don’t know how long this is going to last, but we do know that things are starting to get back to normal in some places around the world, and it won’t last forever. Having some plans for when it does will help you hit the ground running, and take advantage of the situation. We are all hoping for a rush of transactions when valuers start getting back out there – will you be first in the queue? Again, we are happy to chat through your next project, and some lenders are allowing us to start mortgage applications so depending on your circumstances there may be things we can do to start the process.

Stay safe everyone