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Fewer lenders for portfolio landlords to choose from

Almost half of portfolio landlords who had submitted a mortgage application since the introduction of the new rules reported a reduction in the number of lenders available to choose from, according to fresh research.

Paragon’s PRS Trends research found that 46% of portfolio landlords found a change of lender choice, which contrasts with 33% of non-portfolio landlords.

PRA rules introduced at the end of September 2017 are having an adverse impact on the buy-to-let mortgage market according the research, based on interviews with 203 experienced landlords in Q1 2018.


Almost all landlords reported an increase in documentation requirements across the market, with 80% saying requirements had increased and 70% saying they had increased a lot.

Similarly, 80% of all landlords noticed an increase in lenders’ mortgage processing times. However, more than half - 54% - of landlords with larger portfolios said that processing times had increased by a lot compared with just 33% of smaller scale landlords.

Some 30% of BTL landlords said loan-to-value ratios on offer were also lower than before.

John Heron, managing director of Mortgages at Paragon, commented: “The more detailed underwriting required on larger portfolios makes it more difficult for mainstream mortgage lenders to compete successfully for the full spectrum of professional landlord business.

“As a result, we’re seeing a polarisation in the market, with specialist lenders playing to their strengths, adding product features that enhance value for larger scale landlords and increasing their share of more complex, portfolio business.”

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