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Lender raises £400m mortgage funding

Specialist lender Kensington Mortgages has raised £400m of funding through the wholesale financial markets.

The deal, which was announced to the market last week (June 17), was one of the first residential mortgage-backed securitisations (RMBS) to be sold to investors since the onset of the coronavirus crisis, according to the lender.

RMBS consist of bundles of mortgage loans, which are sold on as bonds to investors. The securities were purchased by global institutional investors.

Kensington said it will use the funds to support complex and underserved borrowers get on the property ladder.

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Alex Maddox, capital markets director at Kensington Mortgages, said: “The global financial markets are a hugely important source of funds for the UK housing market.

“While everyone assumes that the flow of money supporting British housing is all about the big banks, that’s not been true for many years.

“About 20 per cent of the cash underpinning UK house purchases is coming from pension funds and debt investors around the world.

“At the start of the Covid-19 pandemic, the Bank of England was quick to ensure that funding was made available to banks and building societies so they could keep lending – which was welcome. With wholesale markets reopening, non-bank lenders such as ourselves can play a more active role in the market again, and help more people towards a house purchase.”

Kensington Mortgages is a specialist lender that offers mortgages to those who find it difficult to borrow from high street lenders.

By Chloe Cheung

Source: FT Adviser

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Skipton reintroduces 85% LTV products

The Skipton Building Society is reintroducing lending at 85% LTV for its standard residential, new build and shared ownership range and also reducing rates on a range of mortgage products.

A series of new products has been introduced to Skipton’s repriced mortgage range as it resumes lending standard residential lending at 80/85% LTV, with rate decreases across the HTB range, and has reduced rates on its interest-only product range; however, Skipton’s new residential range is not available on interest-only.

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Highlights of Skipton’s new mortgage range include:

  • For purchase and remortgage, 2-year fixes at 1.37% to 60% LTV (fee free) and 1.59% to 85% LTV (£995 fee); 5-year fixes at 1.35% to 60% LTV (£1,995 fee) and 1.76% to 75% LTV (fee free);
  • For Help to Buy, (purchase and remortgage) a fee free 2-year fix at 1.89% to 75% LTV;
  • 2-year fee free shared ownership fix at 2.69% to 85% LTV;
  • Buy-to-let (purchase and remortgage) fee free 2-year fixes at 1.99% to 60% LTV and 2.34% to 75% LTV, and 5-year fixes at 1.79% to 60% LTV (£1,995 fee) and 2.19% to 70% LTV (£995 fee).

Skipton recently announced that under a revised affordability approach, it will accept cases from applicants who have been furloughed. However, affordability will be assessed on the new, furloughed income, including any top up contributions made by the employer. The maximum LTV where any applicant is relying on furloughed income is 60%. Product transfers are excluded from these restrictions, unless the applicant is also seeking additional funds.

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Alex Beavis (pictured), Skipton’s head of mortgages, said: “We’re delighted to reintroduce lending at 85% loan to value and reduce rates on many products giving borrowers more choice and better value. As a mutual, we strive to help people buy their own homes and through this difficult time we have maintained high levels of service to ensure our customers get the best experience when buying or remortgaging.

“Our reintroduction of 85% LTV deals for new build, shared ownership and residential purchases and support for furloughed workers demonstrates this commitment.

“In order to help us continue to support our customers, I encourage anyone who needs to speak to us to make use of our online FAQ pages, webchat and email services in order to avoid longer telephone wait times in our contact centre.”

By Kevin Rose

Source: Best Advice

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Kensington Mortgages launches 80% LTV residential rates

Kensington Mortgages has resumed 80% loan-to-value (LTV) lending across its residential Select, Core, Young Professional and Heroes ranges, as well as relaunching Help To Buy and buy-to-let (BTL) purchase applications across England.

On Kensington’s Select, Heroes and Young Professional range, rates start from 4.49% for a 2-year fix at 80% LTV and 4.64% for a 5-year fix rate.

There is a maximum loan amount of £750,000 on the Select range, and £500,000 for Core, Right to Buy and BTL products.

Kensington Mortgages has also relaunched its Help to Buy offering and reinstated new-build applications.

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Rates start from 4.54% for a 2-year fix at 75% LTV.

In England, now that physical valuations can take place, BTL purchase applications have been resumed.

Last month, Kensington relaunched BTL remortgage cases; the same rates apply for new purchase applications.

Rates start from 4.49% for a 2-year fix at 75% LTV and 4.69% for a 5-year fix.

Craig McKinlay (pictured), new business director at Kensington Mortgages, said: “We’re excited to introduce 80% LTV across some of our most well-known product ranges and relaunch Help to Buy in the hope that we can try to provide options for those wishing to step onto the property ladder.

“Over the last few months we have experienced an industry-wide unprecedented challenge, and lenders have been working hard to reintroduce product ranges to try and help boost the market.

“We hope these new updates provide our brokers and customers with accessible funding options and greater choice and for those that can restart their housing plans again, we are here to help.”

By Jessica Bird

Source: Mortgage Introducer

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Lenders return in week after lockdown

Lenders have reintroduced physical valuations and higher loan-to-value lending after the government gave the green light to restart the housing market in England last week after seven weeks of lockdown.

Accord Mortgages announced today (May 20) that it is accepting residential applications up to 90 per cent LTV following the renewal of physical valuations.

Buy-to-let remortgages are currently available up to 65 per cent LTV, although a spokesperson for Accord said an announcement on this was due on Friday.

Meanwhile, Virgin Money and Clydesdale Bank confirmed “a wider range of products supported with a mix of physical and non-physical valuations” would be introduced next week, including residential mortgages up to 90 per cent LTV and buy-to-let mortgages up to 80 per cent LTV.

Temporary limits on loan sizes and property values will also be withdrawn.

Additionally, physical valuations will be booked in England for pipelines cases with Virgin Money and Clydesdale Bank that require such a valuation.

Some lenders had already resumed offering high LTVs last month. Halifax Intermediaries reintroduced lending up to 85 per cent LTV in April, followed by BM Solutions’ return to buy-to-let lending up to 75 per cent.

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Nationwide also extended lending via brokers up to 85 per cent LTV after focussing support on existing borrowers and processing ongoing applications.

Providers had previously withdrawn high LTV lending after the government announced a lockdown on March 23, which effectively brought the property market to a halt.

Additionally, Nationwide has confirmed that valuers will be able to resume physical inspections this week (from May 18) after the government published its new guidance on moving home.

Likewise, Santander announced the following day (May 19) its valuation partners would aim to contact intermediaries’ clients, or the property owner, by May 29 to arrange a date for cases in England that required a physical inspection and had been put on hold.

It anticipated that most valuations will be carried out before June 10.

Santander said it would be holding rates while increasing the maximum loan size to £1m on some residential products, and to £750,000 on its buy-to-let range.

This followed recent changes from Santander such as raising the maximum LTV for residential lending to 85 per cent, and for buy-to-let remortgage products to 60 per cent LTV.

Meanwhile Leeds Building Society is working with Countrywide to complete the “outstanding minority” of valuations on mortgage applications as physical inspections resume in England.

Jaedon Green, chief customer officer at Leeds Building Society, said desktop valuations will continue to be used where appropriate and “for homeowners particularly concerned about social distancing, we’re also piloting external inspections which mean a valuer will still visit their home but doesn’t need to enter it”.

Specialist lenders have also been adapting to market conditions. As well as resuming physical valuations, on May 19 West One Loans relaunched buy-to-let products at 70 per cent LTV, subject to a maximum loan size of £250,000.

For many brokers the renewal of physical valuations is likely to be welcome news.

Andrew Brown, managing director at Bennison Brown, said the main challenge during lockdown was that an estimated 60 per cent of their cases were not suitable for remote valuation.

Commenting on the return of physical valuations and viewings, Mr Brown said: “It is likely to take some time to clear the backlogs and for consumers to gain confidence but it is the first major piece of good news we’ve had for some time.

“We hope this is the start of the recovery of our sector.”

Some advisers had pointed to issues with undervaluations as remote valuations were carried out during lockdown.

Kevin Dunn, director at Furnley House, said some of his remortgage clients, who had properties valued remotely, felt they would have received a higher figure if a physical valuation had been carried out.

By Chloe Cheung

Source: FT Adviser

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Foundation Home Loans returns to new lending with BTL and residential products

Intermediary-only specialist lender Foundation Home Loans has created and launched buy-to-let (BTL) and residential products, and will return to new lending following the return of its valuation partners to the market.

The products will be available to advisers and their clients from 18 May.

For BTL, all products are available to individuals and limited company borrowers, with a choice of both 2 and 5-year fixed rates in Foundation Home Loans’ F1, F2 and F3 ranges, as well as for both houses of multiple occupancy (HMOs) and large HMOs.

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The product range will also include 2-year BTL discount products which have no early repayment charges (ERCs), available for both F1 and F2 borrowers.

These rates start at 2.94% for F1 borrowers at 60% loan-to-value ratio (LTV).

Foundation Home Loans’ BTL range allows loans up to 75% LTV, has a standardised interest coverage ratio (ICR) of 145% at either 5.5% or pay rate, comes with a 2% fee and reverts to Bank Base Rate plus 4.99% at the end of special terms.

The company has also launched a specialist residential range, offering both 2-year fixed and variable rate products.

2-year rates come with no ERCs, with products up to 75% LTV.

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Jeff Knight (pictured), director of marketing at Foundation Home Loans, said: “Since lockdown was brought in, we have continued to lend by processing our existing pipeline, completing in the region of £37m of lending in April alone.

“However, once lockdown began, we took the strategic decision to only allow new applications once we knew it would be possible to instruct physical valuations again.

“Therefore, given announcements made this week, it is really pleasing to say that we can now offer our products to new applicants once again and will formally launch our full range on Monday.”

By Jessica Bird

Source: Mortgage Introducer

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Kensington relaunches residential and buy-to-let products

Kensington Mortgages has resumed lending across its residential and buy-to-let ranges up to 75% LTV.

On Kensington’s Select range, rates start from 4.29% for a two-year fix and 4.49% for a five-year fix rate. The Select range will have a maximum loan amount of £750,000 and £500,000 for Core, Right to Buy and buy-to-let products.

Kensington Mortgages has also launched a non-physical valuation solution for digital valuations. The new software programme will apply to all residential new purchase and remortgage cases, as well as buy-to-let remortgages.

To find out more about how we can assist you with your BTL Mortgage please click here

Craig McKinlay, new business director at Kensington Mortgages, said: “This is an unprecedented time for everyone – customers, lenders and the industry alike – and we’ve been working hard to reintroduce our 75% LTV range. We want to help our brokers and customers as best as we can during this time and still provide accessible funding options.

“We have experienced an industry-wide challenge obtaining physical valuations and have been working had to produce our non-physical valuation solution, which we are pleased to now have in place too. We are constantly reviewing our market position to keep up to date with official guidance and industry best practice in these exceptional times.”

By ROZI JONES

Source: Financial Reporter

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Payment holiday is top search term in residential mortgages

The COVID-19 mortgage payment holidays introduced by Chancellor Rishi Sunak took top spot during March 2020 as the most searched for term among brokers within the context of residential mortgages, according to lending database Knowledge Bank.

Beyond the payment holiday, residential mortgage search terms continued as normal in March, with ‘maximum age at end of term’, ‘interest only’ and ‘self employed – one years accounts’ making up the rest of the top four.

Fifth on the list is ‘defaults – registered in the last three years’, which Knowledge Bank reports is likely to rise in the coming months.

For the buy-to-let market, ‘COVID-19 mortgage payment holidays’ was second on the list, but ‘lending to limited companies’ remained top for the third month running.

For second charges, brokers were most likely to search for the maximum loan-to-value ratio (LTV) or minimum loan amount, the latter arguably showing the increasing need to release cash during the current crisis.

The rest of the top five search terms related to second charges were ‘mortgage or secured loan arrears or defaults’, ‘debt management plan – ongoing/current’ and ‘internal/automated valuation model (AVM)/desktop valuations’.

The last option is a new entry, but one that is expected to appear across all categories as the lockdown continues to interrupt in-person valuations.

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In the equity release market, the top five search terms were ‘early repayment charges’, ‘partial repayments’, ‘property with an annex/outbuilding/land/acreage’, ‘tenants in common acceptable’ and ‘second home/property’.

Fluctuations in this category are likely the result of fewer brokers searching for equity release.

Searches relating to bridging loans and commercial lending were not particularly disrupted; the top search terms here were ‘regulated bridging’ and ‘semi-commercial properties’, respectively, and both categories had ‘maximum LTV’ in second place.

However, these categories are expected to change significantly over the coming month, as many in these sectors are now unable to lend.

In addition to monitoring the most popular search terms, Knowledge Bank has established a ‘COVID-19 criteria live feed’.

This registered almost 500 changes to criteria among 14 lenders within just 48 hours last week.

Nicola Firth, founder and CEO at Knowledge Bank, said: “With the number of lender criteria changes increasing by the day there has never been a more important time to have subscription to a criteria search engine.

“As the UK’s largest and most comprehensive mortgage criteria search system, the industry looks to us to provide up-to-date and accurate information on lending policy.

“At this time of change it is important to reflect the issues and the searches that brokers are carrying out as it reflects on the market as a whole.

“The number of broker registrations and searches has increased exponentially over the past three weeks and the a peek into those searches provides us with a fascinating insight.

“April will clearly be even more revealing as the broker searches could change more dramatically than anything we have seen to date.”

By Jessica Bird

Source: Mortgage Introducer

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Skipton relaunches residential purchase mortgages up to 75% LTV

From 9 April 2020, Skipton Building Society will reintroduce its residential purchase mortgage range, which will include products up to 75% loan-to-value ratio (LTV).

The new mortgage range will include: for purchase, a 5-year fix at 1.65% to 75% LTV with a £1,995 fee; for remortgage, 2-year fix at 1.32% to 60% LTV with £995 fee, and a fee free 10-year fix at 2.32% to 60% LTV; and a buy-to-let 2-year tracker for purchase and remortgage at 2.32% to 60% LTV with a £1,495 fee.

The building society is also introducing a new interest-only range for residential customers.

With home valuations suspended during the nationwide lockdown, Skipton is extending the use of desktop valuations, and introducing a revised affordability approach for applicants impacted by COVID-19.

The building society will accept cases where the applicant has been furloughed, but affordability will be based on their furloughed income, including contributions made by their employer to top-up the government’s 80% scheme.

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The maximum LTV where an applicant is relying on furloughed income in 60%. Product transfers are excluded from these restrictions, unless the applicant is also seeking additional funds.

Skipton is continuing to lend on all Scottish business where a Home Report less than six months old can be produced, including lending up to 95% LTV with a new range of products exclusively available for Scottish lending.

Alex Beavis, head of mortgages at Skipton Building Society, said: “During this difficult time, Skipton remains committed to supporting borrowers by providing access to a broad range of competitive mortgage deals.

“We’re working hard to continue to make our proposition as widely accessible as possible whilst also maintaining the high levels of service brokers and customers expect.

“Our reintroduction of 75% LTV deals for buy to let and residential purchases and support for furloughed workers demonstrates this commitment, whilst the launch of special range of Scottish products up to 95% LTV for applicants with a valid Home Report provides a pragmatic approach to supporting borrowers in Scotland in this difficult and usual environment.

“In order to help us continue to support you and your clients, I encourage anyone who needs to speak to us to make use of our online FAQ pages, webchat and email services in order to avoid longer telephone wait times in our contact centre.”

By Jessica Bird

Source: Mortgage Introducer

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Mortgage lending for Bank of Ireland UK rises as it rolls out new customer propositions

Bank of Ireland UK has reported a 9% increase in new mortgage lending in 2019 to £3.6bn, up from £3.3bn the year before.

This takes its residential mortgage loan book to £16.6bn, a rise of 4.4% from £15.9bn in 2018.

The bank has increased customer retention by 52% from £1bn to £1.5bn in 2019 helping around 17,000 new customers to buy their own homes.

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Bespoke in Northern Ireland

Bank of Ireland UK launched a Bespoke mortgage customer proposition in 2019 in Northern Ireland, which is now being rolled out to intermediaries.

Bespoke is focused on helping customers who may not meet the traditional lending criteria – for example because they have non-standard incomes, meaning their mortgage options may be more limited.

Going forward, distribution of Bespoke will be expanded further across the UK, with the ambition to reach almost 2,000 brokers by the end of 2020.

Paperless mortgages

Customers can now complete their mortgage journey via an online portal removing the need for paper documentation.

Available to both direct customers and to brokers across Bank of Ireland UK and Post Office for Intermediaries, the process allows customers to securely submit documents online, review documents through the customer hub and accept offers without waiting for anything through the post.

The bank estimates the new process will allow it to remove around two million pieces of paper each year.

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Ian McLaughlin, CEO, Bank of Ireland UK, commented: “We are delighted to see continued growth in our mortgage book at a time when the mortgage market is highly competitive. We have made good progress in delivering our mortgage strategy to pivot more towards niche mortgage segments, whilst optimising our volumes in mainstream mortgages.

“We’re particularly proud of the early success of our Bespoke service, launched last year. This tailored underwriting service to brokers in Northern Ireland will help even more people get on the property ladder, upsize to a bigger home or simply purchase their dream home.

“The launch of paperless mortgages continues to enhance our proposition. This innovation will make the process of buying a new home much simpler, easier and faster for our customers. There are significant benefits, not only in terms of speed and security, but also eliminating up to two million pieces of paper a year.”

By Joanne Atkin

Source: Mortgage Finance Gazette

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BoE: Outstanding value of residential mortgage loans up 3.8%

The outstanding value of all residential mortgage loans was £1.499bn at the end of 2019, which is a year-on-year increase of 3.8% according to the latest Bank of England Mortgage Lenders and Administrators Statistics.

The value of gross mortgage advances was £73.4bn which remains broadly unchanged in comparison to Q4 2018.

New mortgage commitments, or lending agreed to be advanced in the coming months, was 4% higher than in 2018 at £70.6bn.

The share of mortgages advanced in Q4 2019 with LTV ratios exceeding 90% reached 5.7%, which is a rise on figures recorded the year previously.

The share of gross mortgage lending for buy-to-let purposes was 12.4%.

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The value of outstanding balances with ‘some’ arrears fell by 2.1% over the quarter to £13.4bn, and now accounts for 0.89% of outstanding mortgage balances.

Mark Pilling, corporate sales managing director at Spicerhaart, said: “The Q4 arrears figures from the Bank of England are broadly positive, showing another fall on the back of previous quarters.

“There was also a small drop in high LTV mortgages and high loan-to-income ratios – although single-income borrowers with an LTI ratio above four actually rose slightly, which could be a cause for concern.

“With the coronavirus Covid-19 already beginning to cause real disruption to businesses and people’s livelihoods, it remains important that lenders have a flexible attitude and continue to seek outcomes that are right for customers.

“There is a strong likelihood that arrears will rise as a result of the virus, and the measures imposed to slow down its spread.

“Lenders need to be ready for a situation where people are facing real financial difficulties through no fault of their own.”

By Jessica Nangle

Source: Mortgage Introducer