Specialist Lender Finally Launches Bad Credit Buy to Let Mortgage Products

After whispers in the industry for a number of weeks, the specialist lender, Precise Mortgages has launched a range of near prime buy to let mortgages for those applicants that have suffered historic adverse credit or small amount of Defaults or CCJ’s registered within the last 2 years.

With the exception of Blemain Finance, whose rates are too expensive to make any bad credit buy to let mortgage work from an investment yield perspective, since the withdrawal of Kensington mortgages from this market in November 2011, there has been no other Buy to Let lenders willing to consider this area of the market.

As would be expected when a lender is dipping their toe into the market to test the appetite for demand for this product, the criteria is quite restrictive and the lender will only allow 1 near prime buy to let mortgage per customer with a maximum of 20 loans across all lenders.

Loan to value is offered at a maximum of 70% (subject to status) and minimum property value is £75,000 or £150,000 in London postcodes. Mortgages are available for properties in England, Scotland & Wales but there are restrictions on certain postcodes in Scotland. Minimum earned income of £25,000 must be proven and minimum age is 25 to a maximum age of 70 at the end of the mortgage. First time landlords are acceptable but first time buyers are not acceptable (classed as not having owned a property within the last 18 months).

Adverse criteria:

• 70% LTV offered with rates from 5.44% on a 2 year tracker. Defaults – 0 in 12 months, 2 in 24 months (Max £750), CCJ’s – 0 in 12 months, 1 in 24 months (max £750), Arrears 0 in 36 months
• 70% LTV offered with rates from 5.74% or 5.44% (65% LTV) on a 2 year tracker. Defaults – 0 in 12 months, 2 in 24 months (Max £1500), CCJ’s – 0 in 12 months, 1 in 24 months (max £1500), Arrears 0 in 12 months, 1 in 36 months
• 65% LTV offered with rates from 6.84% or 6.54% (60% LTV) on a 2 year tracker. Defaults – 0 in 12 months, 2 in 24 months (Max £5000), CCJ’s – 0 in 12 months, 1 in 24 months (max £2500), Arrears 0 in 12 months, 1 in 36 months
• Rental cover of 125% at higher of pay rate or reversionary rate is required on an interest only basis.
• Maximum loan size is £300,000

They are also offering a refund of valuation on completion on certain products.

We strongly recommend that you contact Mosaic Mortgages to discuss your specific circumstances and to see whether you are eligible for one of these bad credit buy to let mortgage schemes that we have access to. As we are offering whole of market advice, we will assess your individual circumstances and recommend the most appropriate bad credit mortgage for your needs. If we can’t help you now then we will give you advice on an action plan to ensure that you will be able to get a mortgage in the future.