Here is the latest update from the Principality Building Society. For full details download/ see their latest product bulletin here. Criteria information is available here. Access these product via our direct to lender mortgage club and get the benefits of payment on completion.
Principality Announcements
We’ve improved our buy to let affordability
Following broker feedback, we’ve made changes to how we stress our 2 and 5-year Buy to Let and Holiday Let products.
We’ve introduced dual stress rates to our buy to let and holiday let product range, so that your clients have more mortgage options based on what they can afford.
Affordability will be based on the length of the initial product rate selected.
This will apply to new purchases, re-mortgages and porting.
What this means for you
When you place a DIP for a new mortgage or re-mortgage:
- Affordability will be based on the product you choose
- 5+ year fixed rate mortgage will have the lower stress rate, if the loan is only affordable over a 5+year fixed rate these will be the only mortgages available for selection
- 1-4 year fixed rate mortgages or any discounted product will have a less favourable stress rate based on the product interest rate + 2%
- A minimum stress rate of 5.5% will always apply
Your client’s options:
- If your client’s mortgage is affordable on both stress rates, they can access all of the buy to let range
- If it is affordable on the lower stress rate only, your client can only access products that have an interest rate which is fixed or capped for 5 years or longer.
- If that is the case, MSO will advise you that your Product selection may be restricted.
If the product is changed during application:
- Affordability will be re-checked to ensure the application is affordable based on the new mortgage product
We’re increasing our desktop valuations limits
We’re increasing our maximum LTV limit and property values on residential desktop valuations to help speed up more valuations for you and your clients.
What this means for you
- We’ll arrange a desk valuation on any residential purchase, re-mortgage or additional borrowing application with a LTV cap of 85%. This was previously 75%.
- We’ll also instruct desktop valuations for residential property with a value of up to £1m, with a maximum loan size of £850,000. This was previously £500,000 with a maximum loan size of £400,000.