It's 125% of monthly payment. Generally stressed at around 5%.
Although two big players in BTL sector recently went 145%. So won't be long till they all fall into line it's basically self policing. There are still 2 lenders for definite that will give you a BTL mortgage without you having to provide income proofs.
The difficulty poker players face is getting past the AML checks and showing where the money become they have came from.
I am dealing with a case just now we're my client has £860k equity looking for an interest only loan of £266k can't place it anywhere. So frustrating, finally thought I had managed it based on figures I took off him when I seen his payslips things took a turn for the worse. Still affordable but no longer meets criteria.
Well mine isn't but I'll leave it with you.
My BTL mortgages are also done on 125% of what the interest payments would be.
Lenders are getting ridic tight on regulations though. Asking for min incomes and going through your bank statements/spending even though your rental income pisses the min requirements.
What if you go through a period of no rental income? I'm not saying I agree with lenders but I understand the reasoning. Too many people take out BTL mortgages with bad advice because tehir situation hasn't be assessed properly.
We weren't talking about what was sensible we were talking about what you can get your hands on.
Agree though there are lots of people who over stretch themselves often with the help of poor advice. I dread to think what's going to happen to highly leveraged BTL investors when the tax rules change. A lot of them will be screwed.
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