Nationwide U-turns on BTL benefit mortgage decision

The Mortgage Works, Nationwide’s buy-to-let lending subsidiary has U-turned on its decision to stop lending to landlords who have tenants on housing benefits.

This week, Mortgage Strategy revealed TMW had altered its criteria and had stopped new lending to landlords who have tenants receiving housing benefits, except in remortgage cases.

Prior to the decision to exclude landlords with tenants on housing benefits, the lender, which has a BTL market share of around 20 per cent, would judge each application on a case-by-case basis.

The lender says the decision was made to U-turn on the exclusion after customers had approached it with concerns.

Nationwide divisional director of mortgages Richard Napier says: “The buy-to-Let sector is very important to us.  We have listened to concerns that have been expressed by some of our customers, over the last few days, and believe this is the right way forward for The Mortgage Works, for landlords and for their tenants.”

There are around 3.8 million households in private rented accommodation, 26 per cent of which – 982,000 households – receive housing benefits, according to Government figures.

Other lenders which will consider tenants on housing benefits include Aldermore Commercial, Manchester Building Society and Paragon and Mortgage Trust.