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Precise Mortgages has made top slicing available across its entire buy to let mortgage range.
The buy to let mortgage lender will now accept top slicing on personal ownership, limited company, portfolio, houses of multiple occupation (HMO), and holiday and student let applications.
They will now allow customers to use surplus portfolio or earned income to demonstrate that they could meet any financial stresses on their new property application, rather than through the rental income of that property alone.
Precise Mortgages has also reduced the number of questions that brokers have to provide answers for and amended its online buy to let calculator.
Precise Mortgages managing director Alan Cleary said of the changes: ‘In a challenging market, we are always thinking of new ways to help more customers get the BTL mortgage they want.
‘By making our top slicing feature available across our entire buy to let range it creates greater access to our products, therefore opening up options to more customers, particularly those who might have been restricted by ICR requirements in the past.’
Top slicing is where a buy to let lender uses a borrower’s personal income to top up any shortfall in rent which is needed for the borrower to obtain the loan amount they require.
The lender will look at the borrower’s income and expenditure and using a calculation (which varies from lender to lender) will ascertain how much surplus income they feel the borrower has which could be used to cover the rental income shortfall.
This can work well for those who are medium to high income earners, have minimal borrowing and three or fewer buy to let mortgages.
However, for Portfolio Landlords (those with four or more mortgaged buy to lets), lenders are required to assess the landlord’s entire portfolio and ensure that they are comfortable that the existing arrangements can withstand rental voids, interest rate rises and the tax changes.