Abbey withdraws buy-to-let lending

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by Gill Montia

Abbey is withdrawing the majority of its buy-to-let mortgages.

The Spanish-owned bank says that the move is temporary and will allow it to focus on products aimed at the residential market.

The lender also reported that it expects the buy-to-let sector to contract and is adjusting its product range accordingly.

From today, Abbey will only offer landlords a two-year tracker mortgage with an interest rate of 6.15% and a maximum loan-to-value (LTV) of 75%. An arrangement fee of £999 applies.

Buy-to-let lenders have continued to withdraw products in the past few weeks causing a headache for landlords needing to remortgage.

Some landlords now face the prospect of reverting to expensive standard variable rates (SVR) because lenders’ criteria are increasingly difficult to meet.

LTV ratios have been hard hit with the disappearance of the 90% LTV product and a reduction in the number of 85% LTV deals.

Last week, Bristol & West increased the cost of loans for landlords by up to 0.4%, to 6.49%.

Meanwhile, the Woolwich has introduced a 1.5% fee for landlords applying for an SVR mortgage and has raised rates on other deals.

According to financial website, Moneyfacts, buy-to-let mortgage offerings have declined to around 145, compared with 806 one month ago.