The Nottingham has responded to feedback from brokers who are looking for mortgages on buy-to-let flats.
The building society is offering mortgages with up to 65 per cent loan to value where the maximum loan is £500,000 and the term runs to a maximum of 35 years.
Properties in blocks of flats where there are no more than 10 floors, and with a valuation of at least £100,000, can be considered. But apartments above the fourth floor must have lift access.
Individual properties, which must have a footprint of at least 35 square metres, need to be at least two years old and previously occupied. The flats or studios must be leasehold with a minimum of 85 years left on the lease.
Nikki Warren-Dean, head of intermediary sales for The Nottingham, said: “Our business development managers across the country relayed that brokers were increasingly asking for us to consider lending against buy-to-let flats.
“That feedback, twinned with the strategic pillar of The Nottingham to grow and reward our membership, led to the decision to add buy-to-let flats to our criteria.”
Ms Warren-Dean added the new portfolio additions may appeal to landlords and mortgage advisers looking for a rental calculation of 160 per cent at 4.25 per cent.
The Nottingham, which offers a wide range of estate agent services including mortgages and savings, has 67 branches across 11 counties as well as an online estate agent presence.
Jorden Abbs, director of operations at specialist UK broker Commercial Trust, said: “We welcome any steps made by lenders to widen their criteria. Increasing choice can only be advantageous to landlords.
“I look forward to seeing how The Nottingham’s offering for buy to let flats evolves as they become more confident in this area of lending.”
Aaron Strutt, communications director at Trinity Financial, said: “We’ve not been aware of a particular issue with buy-to-let mortgages for flats. In many parts of the country this type of property is particularly popular with borrowers.
“Perhaps The Nottingham’s entrance to the market is in response to demand for mortgages on high rise flats, which some lenders may be less willing to offer. I could see that being an issue on occasion.”
Source: FT Adviser