Remortgage as a percentage of total mortgage lending has risen recently to extreme heights. Homeowners are still finding quite favourable deals from lenders who are still offering mortgage packages with low interest rates and competitive closing fees. Landlords are now acting on an increased number of buy to let remortgages before lending criteria changes. The Bank of England is attempting to cool the engines on the number of buy to let purchases which are now taking place.

Landlords are pressing the accelerator on remortgaging buy to let properties due to increased lending criteria which is set to kick off in September of this year. More than half of landlords obtaining lending are seeing an increase in the number of criteria required for qualification.

An increasing number of landlords are producing tax returns, business plans, and forecasts of future earnings in order to get in position for approval and purchase of properties.

The buy to let market has been quite active as of late and new lending criteria is a possible way to slow down that market.

Chris Norris, Head of Policy at the National Landlords (NLA) commented on the latest news, saying: “Since the PRA regulations were introduced in January, the marketplace is looking considerably more complex.

“It was always likely that lenders would start to demand more evidence from applicants, and landlords are already feeling they have to go further to prove that they can afford finance.

“Changes to buy-to-let taxation will eat away at many landlords’ profits and make it more challenging for them to manage their businesses.”

Norris added: “As a result, many are looking to limit their exposure to the changes, which is why we’ve seen a rise in remortgaging.”