Lenders have shut up shop

[badgers_r_us]

I'm having real difficulty obtaining 80k for a BTL. I own my own home outright as well as owning a BTL outright, plus 120k in the bank of which I would put down 100k against a property worth 180k. In total that is 80k of borrowing against security of nearly 750k.

I have 2 problems - I have lived abroad for the past 15 years, so my credit score is low, and only my wife works with an income of 16k. However, both rentals would generate incomes in the region of 20k pa. So we have 3 separate sources of income totaling 36k pa, and I have references from my overseas bank. Plus I am on the electoral role in the UK

The excuses vary, for example one said that since our rental income exceeded 30% of our total income we were therefore considered a commercial operation, another would not take in to account any of the rental income for serviceability calculations, whilst another said that we needed 6 months of rental income from the current buy to let before they would consider this income (which if you think about it it's dumb - surely it's better to have a new lease in place rather than a lease that could be terminated at any time atther 6 months).

Thing is they are all quoting policy and none has any discretion to make decisions based upon the merit of each case. I kept on being quoted FSA regulations as the reason they could not help. It really is a case of "the computer says no"

I could go to a mortgage broker, but fees and rates are just too obscene to make it worth while. Best offer I had was one bank told me they would be prepared to lend me 20k based upon my current circumstances. I really do sympathise with anyone out there looking for finance, because if I can only get 20k, with 36 k of income and 3/4 of a million worth of property as security, what chance do they stand? These banks just do not want our business, but are hiding behind FSA regulations. Ar5e holes! Hope they choke on their huge bonuses.

[drhouse]

A lot of independent financial advisers will do an initial consultation for free and will lay out their terms for you to decide whether or not to proceed. Phone round a few and see what they offer.
I had an instance lately of a client being refused a mortgage by a bank - after leading them on for weeks that it would be no problem. I got a consultation with an adviser for them and he got the mortgage processed in 2 weeks and at a lower rate than the bank would have charged. Of course the iFA charged a fee - I don't know how much as it was between them and not my business - but I know they were delighted with the service and the speed which was very important.
Banks are doing everything they can to put IFAs out of business and then they can all go back to charging exorbitant rates and arrangement fees.

[KDWALKERMS]

I would agree with drhouse speaking with a no fee mortgage broker or IFA could be the next step for you and there are some around. They may have access to lenders who are not available on the high street. Alternative to this, could be an option of commercial finance. Good Luck!

[dealdirectfinancial]

Have to agree with the two previous speakers. You stand nothing to lose if the initial consultation is free, and the IFA's are pretty motivated to provide good service right now, with pickings so slim.

[Enness Private Clients]

you should try lloyds or barclays international - both can be flexible at this level

[The Mortgage Hut]

I would take Enness's advice, I onyl know of one lender who could help, but they would require proof of residency for the last 3 years ideally.

Regards

Chris

[ComareTheMortgageMarket]

Do you now live in the Uk then? The low credit score may cause a little problem with buy to let as they require a higher credit score usually. 1 thing you could look at is a remortgage on your own property to raise the money and buy the property outright. It is always cheaper going the residential route & if you can show proof of income to cover the mortgage there should not be a great issue.

Buy to let in general only requires a £25k annual income & in most cases is not required as proof. There is a lender that lends on rental income alone (125% yield) regardless of personal income.

[builder66]

The QE has not really eased anything has it. Be careful how many times you try, it can give off a bad signal.

[Penny_Puffer]

Making sure that you settle your credit card bills will make your credit score high and this is very helpful when acquiring loans or mortgage, a credit repair companies might also help.

[ComareTheMortgageMarket]

Actually having active credit and meeting the monthly payments increases your credit score. Settling them and leaving them will not.