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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.

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  • John Deacon 2nd March 2013 at 11:17 am

    So, Lloyds Banking Group won’t lend on BTLs housing benefits either through BM Solutions (the other biggest BTL lender), yet Nationwide gets absolutely slated. Considering it was never a change of policy in the first place, as they never specified they did it, and they clarified their position on it – I think they should be commended for changing their position as they are once again stood out of the pack. I think the other lenders should be looked at more closely…

  • Des Platt 2nd March 2013 at 1:26 am

    Credit where credit is due. Unusual for me to praise a lender but if you are going to criticise like I do, only fair to give credit to a lender who have listened

  • Doug Hall - 3mc 1st March 2013 at 7:45 pm

    Hats off to TMW!More lenders will enter into the arena over the coming months