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Mortgage lenders and brokers have not been vocal enough about the Prudential Regulatory Authority’s (PRA) changes to buy to let lending, according to a statement from the National Landlords Association (NLA).
The NLA has discovered that many landlords remain unaware of the changes. Despite significant alterations to lending criteria and to the application process for portfolio landlords, 55 per cent are unaware of the changes that have been implemented by the PRA.
The findings, which come from the NLA’s Quarterly Landlord Panel, noted that a mere eight per cent of landlords said that their lender had been in touch about the changes. 16 per cent were contacted by their broker.
However, worryingly, 68 per cent said neither their lender nor broker had made contact with them about the changes. However, the findings show that brokers and lenders may have focused on informing larger portfolio landlords. 26 per cent of portfolio landlords stated that their broker had been in touch, whilst nine per cent saying their lender had made contact.
CEO at the NLA, Richard Lambert, spoke out about the Panel’s findings: ‘The PRA’s changes will greatly affect the ability of landlords to find new finance and continue to provide good quality affordable housing to those who need it. We hope that that the reason such a significant number of landlords haven’t been contacted is because their existing deals are simply not yet close to expiry.’
He continued: ‘However, it’s in lenders’ and brokers’ own interests to speak to landlords about the changes sooner rather than later, otherwise it could mean a missed opportunity in terms of new business. If landlords don’t get the right support and information about how the changes will impact their existing loans, then it could mean higher finance costs that many just won’t be able to absorb.’