BTL: The good and bad lenders out there

I think it's high time we had more lenders and products entering or re-entering the market place.

I cast my eyes back to only 2-3 years ago when I could switch on Trigold (my residential sourcing system) and list about 80,000 products. Well today the entire database of residential mortgages is only 4,658. List just the BTL mortgages and we are down to a measly 458.   At first glance that sounds like plenty of choice, but look more deeply at this and there are just 34 lenders on BTL, and if we start to move the duplicate products, (the products that appear over and over via different packagers), and remove the lenders that only lend in small local geographical areas, then the handful left is measly indeed.   And lest we forget two or three of these lenders are subject to the atrocious panel route.   From where I'm sat, the appetite of both residential lenders and commercial lenders still seems to be at a very low point. Only Bridging lenders seem to be vying for clients just now, with plenty of new innovative products and funding out there. What highlighted this for me was a discussion that I had with a BTL and commercial packager last Friday whilst I was researching finance for two clients.   The scenarios were extremely similar: a client in Manchester looking to purchase a three storey terraced building, now three self contained flats, and a client in Bradford looking to purchase two separate residential properties to refurbish and add to his large BTL portfolio – all three properties are at auctions this week. They each require immediate funding to adhere to the auction 28 day rule, plus lenders that will lend whilst the property is being refurbished.   My research clarified that the innovative Bridge to Let by Tiuta was one possibility, albeit via a very small panel, the cretins, whilst straight to mortgage with TMW was another option on their Light Refurbishment Product – but my recent dealings with them put that option to bed as their admin can't work to the 28 day rule currently – but they will get back on the ball I'm assured, after all it's moving back to the 80% LTV bracket that's seen them inundated.   A further little jewel I found was another lender that will immediately refinance a Bridge, (no six months to wait), so more innovation to cheer. The lender is Paragon Mortgages. I had thought this particular lender had stopped lending, which isn’t the case, but again it's an exclusive via one packager – but an excellent addition to my choices all the same.   In both clients’ cases the end results mean a Bridge will be used for speed, as well as offering funds before refurbishment. The excellent Auction Finance, and the newly re-branded Bridging Finance Solutions, are the lenders that have come up with the goods for me. It'll be a close run thing in these cases, but rest assured they are two lenders who appear at the top of my hit parade just now, so future business is assured...   And with Northern Rock being joined by my new little lending jewel Paragon Mortgages, the Bridging could be redeemed in three months or so, so there is some light at the end of the tunnel as far as current appetite, and innovation goes.   Well done to these lenders!