Changes to Lloyds' buy-to-let lending policy 'very restrictive'

Posted: 24 Sep 2010 09:13:04 GMT

Lloyds Banking Group's decision to alter its buy-to-let lending policy could cause other lenders to increase their rates, as there is not much competition in the market at the moment, one expert has observed.

David Lawrenson, founder of LettingFocus.com, said the move is "very restrictive".

According to Lloyds, portfolios will be limited to £2 million worth of properties and will cover a maximum of three domiciles.

However, Mr Lawrenson noted many landlords will already have three dwellings across the group and would be unable to get a mortgage due to the modifications.

"The problem is that there are not that many providers in the market and the mortgage rates that they are charging are quite high and so are the fees relative to residential," he added.

The financial services provider claimed the changes mean it will continue to support "the vast majority of landlords" and stated nine-out-of-ten buy-to-let borrowers have less than three properties.
 

© Houseladder Ltd