View more on these topics

Remortgaging funds portfolio growth

Landlords raising capital to finance the expansion of their portfolios are behind a rise in buy-to-let remortgage activity, according to Paragon Mortgages.

Council of Mortgage Lenders data shows remortgaging accounted for more than two-thirds of a 21% increase in buy-to-let gross lending between Q1 and Q2, and Paragon says capital raising was the primary motivation for remortgaging.

Research by the lender shows that 47% of buy-to-let remortgages handled by brokers were for the purpose of raising capital in Q2, while 35% were to achieve a better rate of interest.

A further 8% cited customers’ existing lenders actively encouraging remortgaging and 7% mentioned dissatisfaction with an existing lender.

John Heron, managing director of Paragon, says: “Around two-thirds of properties in the private rental sector have no mortgage while the average LTV on properties with a mortgage is 48%, so there is a huge amount of equity in the sector that landlords are looking to use to fund portfolio growth.”

Recommended

Bogus broker given a suspended sentence

A man masquerading as a broker has been convicted of fraud after pocketing a £5,000 arrangement fee from a client. The Birmingham Mail reports Mohammed Aslam was sentenced to 12 months in prison suspended for two years and 250 hours of unpaid work.

ALAN CLEARY, MANAGING DIRECTOR, PRECISE MORTGAGES

Ensure your client relations are strong

The Financial Services Authority’s recent report on the mortgage market showed the number of deals originated by intermediaries has declined.

Guide front cover - thumbnail

Guide: how to… audit your auto-enrolment scheme compliance

As the Pensions Regulator starts to bare its teeth and the changes mentioned in the Budget and Queen’s Speech start to come into force, it is essential that you understand your scheme and the processes you need to undertake to ensure it remains compliant. Our second re-enrolment guide looks at how to audit the key areas of your auto-enrolment scheme.

Newsletter

News and expert analysis straight to your inbox

Sign up