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LettingFocus

Unbiased buy to let, property investment and letting coaching, mentoring, advice and seminars for landlords from top selling property author and media commentator.

Skipton Building Society Pulls a Fast One on Mortgages. Will Other Lenders Follow Suit asks LettingFocus.com

I’m interested in the recent decision by Skipton BS to unilaterally change the way the Standard Variable rate (SVR) is applied on their variable rate mortgages.
It could set a precedent to other mortgage companies.
In their mortgage agreements it was apparently stated that the SVR would be at a set amount above Bank of England base rates but it seems there was also a clause which in the event of “exceptional circumstances” allowed them to alter this.
So they have now invoked this clause and bumped up their rates.
Nice!
I guess they have checked that the mortgage agreements with their customers really allowed them to pull this trick but I wonder if this was made crystal clear within the main part of the original mortgage agreements when their customer signed.
If not, then how legal is this move?
Indeed I wonder if there is a case of an Unfair Contract term here.

PARALLEL IN THE FOXTONS CASE?
In the Skipton case, I’m wondering if there is a parallel with the recent case of the Foxtons letting agency renewal fees.
Here, Foxtons got into trouble with a judge because the renewal fee (or repeat fee) it charged landlords when a landlord extended their tenancy was hidden away and not made clear to the landlords when they signed up with the letting agent.
The judge ruled that in cases where the possibility of repeat renewal fees on lettings was not made clear by Foxtons (and indeed any other letting agent) it acted as a kind of “trap” for consumers.
Indeed, the judge actually used the word “trap.”
The Foxtons ruling has opened the way for landlords to claim back years of overpaid renewal fees with letting agents. (We have commented extensively about the Foxtons case in other posts – click on the Categories at the bottom of this post for more on this.)
So far, I see no one in the main stream press has really bothered to question the action of Skipton Building Society in invoking an odd clause to up their SVR rate.
Perhaps they should.

MORTGAGE CUSTOMERS OF OTHER BANKS SHOULD BE WORRIED TOO
I have to declare a particular interest here.
One of my buy to let mortgages is on a lifetime tracker of 0.69% above base for life; another is on 0.89% above base - also for life. Others mortgages have neatly defaulted to 1.5% above base for the rest of time.
I do hope the lender who issued those - in both cases for a one off mortgage fee of much less than £1,000 (ah the good old pre credit crunch days!) - will not be able to wriggle out of what is a great deal for me! And a duff one for the banks!
Many other people with mortgages which were taken out in the good times will be in the same boat as me and will be wondering if they could also get shafted by their lenders in the same way as Skipton has hit its borrowers.
Someone needs to look into this before the rest of the banks and building societies follow Skipton’s lead.

MORE ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of landlord information.
I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling commercially published property and buy to let book for the last 3 years.
At a corporate level, I provide consultancy for banks, local authorities and social housing providers – helping them with their landlord facing or buy to let product strategies.
I also write for property websites and am regularly quoted by the media.
I have written articles for numerous publications including The Independent, The Telegraph and quality landlord websites.

We still do a bit of work for private landlords too.
We help landlords and property investors make money in property by coaching them in ways that really work, which are ethical, fair to tenants and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on either a one to one mentoring / coaching basis or through our occasional group seminars.
Unfortunately, in the UK today, property advice in the UK is still largely unregulated and what counts as “good advice” is too often more about making the promoter money than giving useful information to the investor.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it. We also show investors how to manage tenants properly and fairly.

AT OUR WEBSITE LETTINGFOCUS.COM:

THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
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NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
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For general info on our CORPORATE CONSULTING click here: Property Seminars, Networking Evenings and Consulting
TO READ CLIENT TESTIMONIALS – both from companies and from private landlords click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk

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Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.

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Off Plan Developments – It May be Getting Harder to Walk Away

I see that some property investors who walked away from off plan deals face being prosecuted by the developers after a test case which a developer won.
In the last few years, lots of purchasers have tried to walk away from duff off plan property deals - figuring it was better to lose their deposits than complete purchases on properties where the values had fallen heavily (and they were effectively overpaying.)
In some cases, willing buyers were unable to complete their deals anyway as their mortgage lenders had pulled financing as prices of these types of properties collapsed.
(Not terribly bright valuations done in the first place then by the banks!)

High Court Case
The recent High Court test case was won by Prestige Homes and this case could lead to lots of other cases being taken to court by developers.
However, at least one group of investors is resisting, claiming one developer recommended customers use the developers own preferred solicitors who presented purchasers with lists of valuations supposedly carried out by other surveying firms which miraculously matched the sales list”.
Somehow, this all seems very familiar.
I have to say that it really is a case of buyer-beware in property, especially where new build was concerned.
Back in the early and mid Noughties, many new and green investors got mugged by so called "property clubs" into buying a lot of new build stuff that was way overpriced.
We are still seeing the fall out today.

Keys
When I buy a property I love it if the previous occupant leaves lots of keys behind.
Getting new keys cut seems to be getting rather expensive these days and even worse, takes up lots of time as the keys you get copied often don’t fit, necessitating extra trips back to the locksmiths.
This is one of the really irritating nitty gritty aspects of being a hands-on landlord.
If any locksmith can guarantee that he can cut an EXACT copy of a key that he guarantees to fit my locks perfectly, then he can have all my key cutting business.

BBC International – Why Bother
I’m just back from a lovely business -cum-holiday break in Mexico.
And as I always when I’m abroad I watched CNN to keep up with the news - not the much inferior BBC TV service.
If the BBC cannot put out a decent international product, maybe it would be best to shut it down completely.
The BBC Radio service overseas is great… but the TV…. Well, I wouldn’t bother.

MORE ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling commercially published property and buy to let book for the last 3 years.
At LettingFocus.com, we help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on either a one to one mentoring / coaching basis or through our occasional group seminars.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it. We also show you how to manage tenants properly.
At a corporate level, we also provide consultancy for banks, local authorities and social housing providers – helping them with their landlord facing or buy to let product strategies.
We also write for property websites and are regularly quoted by the media.
We have written articles for numerous publications including The Independent, The Telegraph and quality landlord websites.

AT OUR WEBSITE LETTINGFOCUS.COM:

THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk

To JOIN our Free QUARTERLY NEWSLETTER simply send an email to [email protected] - Please note we WILL NOT send spam or sell our mailing list to advertisers!

IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR TO OUR WEBSITE?
IF YOU SELL SERVICES TO LANDLORDS, YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!

See our Twitter page: http://twitter.com/LettingFocus

Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.

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Bad Time to Buy Property as an Investment? By Lawrenson of LettingFocus

To come to the NEXT PROPERTY SEMINAR AND NETWORKING EVENT for Landlords and Property Investors on 4th November click here:
Next Seminar Event
A weird thing happened last year.
An old pal of mine from Merseyside bought a house right next door to the place where we used to live on the Wirral when I was just a small kid. This next door house was identical to our one.
He paid about half a million for it. My father paid £30,000 for ours back in 1971.
Not a bad increase in price over time I guess.

Don’t Compare Oranges with Bananas
But when comparing property prices over time don’t forget that properties need to be maintained which costs money.
And, of course, the quality of what’s in today’s properties is so much better than what one would have put up with in the 1970s.
Bleeding obvious I know - but often forgotten by many commentators.
So when comparing property prices today with what they were some years ago and saying “Gosh, how much things have gone up” we must always remember that we are not exactly comparing like with like because maintaining and improving property costs real money.

Inflationary Hedge
But all the same, those kind of figures really does show how property is a great inflationary hedge.
Money left in the stock market over the period 1971 - 2009 would have done pretty well too.
An investor friend of mine - Rochdale Andy - noted that he rather fancied gold at the moment but then added “Unfortunately I can’t leverage up to 70% buying gold.”
And nor can you borrow money to buy shares either.
Just go to your bank and see if they will loan you money to buy shares without any asset to back it and see how far you get.
And I imagine that, even if it were possible to borrow money to buy gold or shares, it would not normally be tax deductible either in the same way as investing in let property is .
And neither would gold produce a rental income.
These factors, for me mean that the right type of let property will beat shares most of the time.

Is It a Good Time to Buy Now?
It’s better to buy now than it was in 2007 right? House prices are down so it has to be better to buy now. Isn’t it?
Well, I bought 2 places in 2007 and where I have invested prices are down between 5 and 10% on 2 years ago.
Should I not have waited? Should I not have seen what Sir Fred and the other banking eejats were up to and held on through the credit crunch to buy now.
I disagree. At least not for one who needed mortgage financing to complete the purchase.
Why?
Well, back then I could get an 85% loan to value at a buy to let mortgage rate of just .69% above base rate FOR LIFE for a mortgage fee of about £500.
Now, the best loan to value is a measly 75%, the best buy to let mortgage rates are a whopping 4.5% above base for just 3 years followed by 2% above base for the rest of time.
And the fee is a whopping 2.5%, )which would have been £2,500 on that particular property.)
I’ve done the maths and because of the effect of the cost of money, it still looks like 2007 was a better time to buy. That said, I think 2009 will also prove good in the long run too partly because I think inflation will come roaring back within 2-3 years.
But I will look in more detail at why I think today is a good time to buy to let in a forthcoming blog.
To come to the NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors on 4th November click here:
Next Seminar Event
To read blogs on related topics, please click on a suitable Category button at the bottom of this post.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
We are LettingFocus.com - the property experts.
I’m, David Lawrenson, the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property book.
What’s unique about LettingFocus is that I offer independent unbiased
property seminars covering property investment and letting because unlike most people in the buy to let and property “advice” business I am not linked to a property company, developer, agent or bridging loan financier.
I can tell you where to buy (which areas), what type of property to buy, when to buy, how to buy property at a low price, how to make sure you get tenants who are going to pay the rent and how to manage a rental property to make £s at my one to one consulting service.
I can also comment on “No Money Down” Schemes and “Buying Below Market Value” methods too.
I can answer all your questions on letting property too because I have been a landlord and property investor for over 25 years.
LINKS
Find out about GREAT DEALS we have arranged for landlords by clicking here: Property Investors’ Affiliate and seeing our Affiliates page.
More products will be added over the coming months. If you are a merchant with national coverage, get in touch!
For SEMINARS, click here: Property Seminars, Networking Evenings and Consulting
For the NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors click here:
Next Seminar Event
For ONE TO ONE CONSULTANCY help click here: Private One to One Consulting
To BUY THE BOOK click here: Buy the Book at Amazon
For THE HOME PAGE OF THIS BLOG click here: Blog
For THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
For GREAT OFFERS ON Products for Landlords, click here: Landlords Resources
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to [email protected] - Please note we WILL NOT send spam or sell our mailing list to advertisers!
Copyright of Blog: David Lawrenson 2009.
This blog is updated roughly once a week usually on a Monday or Tuesday.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
Over on the right hand side under all the previous blog entries you will see a button which says “Site Feed.” Simply copy the site feed link into your News Reader or News Aggregator.
We suggest you search Google to tell you more about what a “News Aggregator” or “News Reader” is. It’s dead easy, honestly. Even a non techie like me managed to do this in a few minutes.
Please note if you have a website & are thinking of reproducing material here - that’s fine but we DO require a link to the blog to be included, including also all the links in this section. The full article including all links must be available to ALL VIEWERS of your site and not restricted.
WANT TO ADD A COMMENT?
To add a comment to this post, you just click on “link to this post” then simply add your comment. To view past comments, again and rather oddly (we think), you’ll need to click “link to this post” and view the comments (which will appear at the bottom of the post.)

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Bank of China, Mortgages, Defaulting Landlords by Lawrenson of LettingFocus

As you may know from a previous blog post on Monday 6th July, I have recently railed against the fact that in Buy to Let Land the borrower is being carved up by a complete lack of competition among lenders.

BANK ROBBERS
The Lloyds Group (via its C&G and BM Solutions/ Birmingham Midshires brands) and The Nationwide (owners of The Mortgage Works) now now have no competition post credit crunch. (The crunch meant the likes of Paragon and others got starved of funds and Bradford & Bingley and Northern Rock bit the dust for new money.)
Lloyds and Nationwide are charging a minimum of base rate plus 4.2% for buy to let with fees of at least 2.5%.
Outrageous!
So, I’m delighted to see that Bank Of China has now started to market its buy to let mortgages a bit more aggressively.
Finding their mortgages on the Net is hard though.
Possibly harder to find than a story about Tianamen Square on Google’s Chinese operation (Google goes along with Chinese censorship if you did not know – nice people Google eh?)

BANK OF CHINA BUY TO LET MORTGAGE RATES
Their mortgage rates aren’t bad but borrowers must have enough income to cover both their home mortgage, and that of the investment property, in order to qualify.
Also, maximum loan to values are just 65% on freeholds and 60% on leaseholds.
The rates charged depend on if you are buying a freehold or a leasehold property too and how much you want to borrow (whether the property is over or under £250K).
To keep it simple, for what usually I buy - which is freeholds and houses under £250K in value, the maximum LTV is 65% and the mortgage rate is 3.5% over Bank of England base for life.
However, you must take out a 20 year term and they will only do repayment mortgages, there being no interest only option.
The arrangement fee is a reasonable £1495 (and the valuation fees aren’t bad either) though you cannot add these to the loan.
Early redemption penalties only apply in year one and are 1% of the loan which is good compared to UK lenders.
The downsides for many people will be the low Loan to Value, the lack of an interest only option, the fact that your own private (non rental) income is looked at carefully too plus you have to attend an interview at a Bank of China office
Still at least it is some competition for the rogues at Lloyds and Nationwide.

GOOD LOAN TO VALUE DEALS
We, of course, offer some great rates through our affiliation with Mortgage for Business and these DO go up to 75% Loan to Value,
Try Mortgages for Business.co.uk by clicking on Great Rates on Buy to Let Mortgages and quoting LettingFocus for their special offer of £250 brokerage when you draw down a buy to let mortgage - set up especially for us.

LATEST ON EVICTING TENANTS OF DEFAULTING LANDLORDS
Talking of our dumb mortgage lenders, tenants who currently face immediate and unexpected eviction because their landlord faces repossession will be given two months’ statutory breathing space to find a new home, under new government proposals.
You may have seen my email correspondence with the Council of Mortgage lenders on my previous post on 30th May about this.
The problem is because tenancy agreements are deemed unenforceable in cases where the borrower has failed to inform the lender of their intention to let the property.
Under proposals from housing minister John Healey tenants in this situation will be given at least two months to find alternative accommodation, through new powers granted to courts in charge of possession hearings.
Unauthorised tenants will also have the right to be heard at these hearings.
In addition, the government is proposing to force lenders to provide unauthorised tenants with a mechanism to request a two-month delay in repossession from lenders. It also wants lenders to consider other steps instead of repossession, such as appointing ‘Receivers of Rent’ to collect rent and manage occupied properties.
About time too!
Shame the mortgage lenders have had to be forced into this by the Government.
In next weeks’ blog post (out 24th August) I’ll look at the Government’s well meant but silly plans to limit the number of shared houses in some areas.
Link to other posts on today’s post topics:
http://www.lettingfocus.com/2009/05/mortgage-lenders-evict-tenants-too.html
http://www.lettingfocus.com/2009/07/buy-to-mortgage-rates-deviod-of.html
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
We are LettingFocus.com - the landlord experts.
I’m, David Lawrenson, the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property book.
What’s unique about LettingFocus is that I offer independent unbiased
landlord advice seminars covering property investment and letting because unlike most people in the buy to let and property “advice” business I am not linked to a property company, developer, agent or bridging loan financier.
I can tell you where to buy (which areas), what type of property to buy, when to buy, how to buy property at a low price, how to make sure you get tenants who are going to pay the rent and how to manage a rental property to make £s at my one to one consulting service.
I can also comment on “No Money Down” Schemes and “Buying Below Market Value” methods too.
I can answer all your questions on letting property too because I have been a landlord and property investor for over 25 years.
LINKS
Find out about GREAT DEALS we have arranged for landlords by clicking here: Property Investors’ Affiliate and seeing our Affilates page.
More products will be added over the coming months. If you are a merchant with national coverage, get in touch!
For SEMINARS, click here: Property Seminars, Networking Evenings and Consulting
For the NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors click here:
Next Seminar Event
For ONE TO ONE CONSULTANCY help click here: Private One to One Consulting
To BUY THE BOOK click here: Buy the Book at Amazon
For THE HOME PAGE OF THIS BLOG click here: Blog
For THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
For GREAT OFFERS ON Products for Landlords, click here: Landlords Resources
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to [email protected] - Please note we WILL NOT send spam or sell our mailing list to advertisers!
Copyright of Blog: David Lawrenson 2009.
This blog is updated roughly once a week usually on a Monday or Tuesday.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
Over on the right hand side under all the previous blog entries you will see a button saying “Site Feed.” Simply copy the site feed link into your News Reader or News Aggregator.
Even a non techie like me managed to do this and Google is worth a search to tell you more about this.
Please note if you have a website & are thinking of reproducing material here - that’s fine but we DO require a link to the blog to be included, including also the links in this section. The full article including all links must be available to ALL VIEWERS of your site and not restricted.
WANT TO ADD A COMMENT?
To add a comment to this post, you just click on “link to this post” then simply add your comment.
To view past comments, again, you’ll need to click “link to this post” and view the comments (which appear at the bottom of the post.) All comments are moderated.

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Choosing Letting Agents / How the UK’s dopey banks made a mess of buy to let mortgage lending by David Lawrenson

Following on from last weeks’ blog, where I said landlords are not suffering too much, it seems that some landlords are suffering after all – even in the face of record low interest rates.
Latest figures from the Council of Mortgage Lenders now show investors’ arrears rates are significantly higher than for standard residential.
So, what’s the truth?
Well, the truth is there are landlords and there are landlords.
Unfortunately, lots of would-be landlords did not do their research and believed all the hype spun by the many Get Rich Quick gurus and have gone on to make a complete muck up of it – bankrupting themselves in the process.
Many of these will have been to a guru’s seminar and went out and either bought existing housing with No Money Down from distressed sellers using bridging finance with a back to back next day remortgage or they bought new build ghetto flats with gifted or hidden deposits.
Both techniques have finally been stopped as the UK’s rather dozy mortgage lenders finally woke up to the fact that they had in fact just lent on 100% of the property’s value (or at least what the buyer paid.)
(Many borrowers would also use credit cards and loans for non existent kitchens to finance deals.)
With little understanding about how to be a landlord quite a few of these would-be investors got into trouble - and therefore so did the banks and building societies that lent them the mortgage cash.
On the other hand, landlords and property investors who ignored the hype, hopefully the type who read my property investing book – and listened to informed experts of the likes of Richard Bowser, Tom Entwistle and myself at property shows will have done rather well.

BUT WHY WERE BRITAINS MORTGAGE LENDERS CAUGHT OUT ON BUY TO LET?
That’s a very good question.
At a recent seminar I heard from John Corey, an American property expert about how in the USA, the types of techniques that borrowers were pulling here to raise big buy to let mortgage loans in which the borrower had no equity, had long been known to mortgage lenders and had either been stopped by law or through the use of intelligent underwriting techniques.
For example, by requesting up to a years worth of bank statements the American lenders could really assess a borrower’s true financial position. In the USA, it would have been impssible to raise say, £25K on a loan for something else one month and then use it as a deposit on a house the next month.
But in the UK, these kinds of things and many other sneaky tricks went on for years.
I suspct that many mortgage lenders in the UK did not have a clue about back to back re-mortgaging as a technique for someone to acquire a property with “No Money Down.”
OK, by sometime in 2006 and 2007 they had all finally woke from their slumber and have now stopped this kind of thing.
But if you get a buy let mortgage loan today, you will still walk out of the bank with virtually no help, no guidance or anything else to help you be a good landlord.
Unless you have read the right stuff you will have a good chance of becoming another arrears statistic on their buy to let loan book a few years hence.
A few years ago I contacted some senior figures in some of the banks (not easy – even getting their names is hard enough) and suggested that as a leading property author I could help them correct this failing. I’m still waiting for the call back.

MIND IF WE KICK YOU AGAIN SIR?
Don’t tell my partner but I have subscribed for most of the rights issues in the shares I have.
Many of these shares are well down on what I paid for them, so it’s a bit like asking a mugger if he would like to hit you and rob you again.
But the shares are all very heavily discounted and I figure that after the RBS’s famous 200 pence a pop rights issue surely, no one would be allowed to put out a rights issue prospectus which was so clearly full of nonsense.

TIPS FOR USING LETTING AGENTS
Don’t go with the letting agent that charges the lowest fees or one who claims he can get the highest rent. It is important yes, but not the only thing that counts. If the agent says they can get a premium rent. Fine. Ask them to prove what rent they have achieved for properties like yours by showing you comparables.
Ask other landlords which agents they use and trust. Then check if the agent is a member of a recognised trade association such as The Association of Residential Letting Agents which has a code of practice for members and client money protection schemes in place. Others bodies offering similar protection include The Royal Institution of Chartered Surveyors and the National Approved Lettings Scheme.
Landlords should check what protection the agent’s membership of a trade body gives them and if the agent is really still a member.
True, there are some very good and long established agents who are not members of any trade body for good reasons - like the very high cost of membership.
If you are set on using one of these, that’s fine, but make extra sure to check references and find out how long they have been in business.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of LettingFocus.com - the landlord experts. Read Property Articles.
I’m the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property book - buy Property Investment Book. The new edition is for both accidental landlords and more experienced residental property investors and is fully up to date with all the recent changes to tenancy deposit schemes, landlord registration and capital gains taxes.
I’m a property expert and property speaker - and I run the well known property blog that you are reading now.
I contribute to newspapers and a host of property websites, write a number of columns in the press and I provide general advice on property letting to anyone looking to buy property for themselves or to let.
What’s unique about lettingfocus.com is that we offer independent unbiased advice on renting out property because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier other than through the links we have on our affilate scheme page. Find out about some great deals we have arranged at our Property Affiliate page.
For landlords' insurance products such as rent guarantee cover and property insurance click on Ukinsurancenet. Don't forget to quote our reference code, LFOC, to get the best rates from them too.
Copyright: David Lawrenson 2009. This blog is updated roughly once a week.
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Base rate tracker buy to let mortgages by Letting Focus.

Well it has been quite a week hasn’t it?
There have been some good things - some coordinated government intervention in the banks, a review of bank executives’ pay (much to Digby Jones’s dismay) and at last, some of the top guys at a bank that caused the mess look set to get their marching orders. Bye bye Mr. Fred Goodwin of RBS.
The 0.5 per cent cut in interest rates is also great news for me, many other landlords and anyone with any mortgage tied to the BOE base rate. It goes a tiny way to making up for huge losses suffered on the casino otherwise known as the stock market.

GET A BANK OF ENGLAND BASE RATE TRACKER
I have always been a fan of Bank of England base rate trackers – in fact all my mortgages are on BOE base rate trackers- and I have long advised that people should steer clear of anything that tracks anything that their lender can change at a moments notice, such as the lenders’ standard variable rate.
I’m lucky enough to have had the foresight to have gone one better and taken out some lifetime buy to let mortgage trackers at 0.69% and 0.89% above BOE base rate, which now looks like great business. I just wish I had done the same for the whole of my portfolio of mortgages, as the majority of my buy to let mortgage loans will need to be remortgaged in mid 2009.
So, my advice is if you are on a mortgage which has just gone down as a result of the 0.5 per cent cut in the base rate, use the money wisely and think about stashing away the savings you will get as a result of the cut in base rates, especially if any of your loans have to be remortgaged next year.
If you have loans reaching the end of their discount period and coming up for remortgage, you will need access to lots of extra cash to meet the very high arrangement fees for the current crop of mortgages now on offer - that's if there are any deals worth going for. If not, you may as well stay on your mortgage companies default mortgage rate as it may be better than the new stuff on offer.
These high arrangement fees, which are typically anywhere from 1.5 to 3 per cent, will be around for as long as the crunch is with us - which could be for another 2 or 3 years.

LONDON HOUSE PRICES FALLING
On a bright note, finally, at last here in London, I am seeing vendors starting to drop asking prices on property.
As you may know from my seminars and public speaking events, I have not bought in the capital for 5 years because I have long thought that prices are way too high here even when one is buying “Below Market Value,”whatever market value is!
Well, at last some sense is starting to appear and I’m seeing some real markdowns in house prices. See our article on Why the credit crunch makes it easier to buy property below market value for more on this,
However, I fully expect house prices to fall for at least another 9 months as the effects of the credit crunch start to roll over into what’s called the “real economy” – which means anything and anyone outside the hallowed halls of the pin stripe and braces brigade in the city.

CHOOSE TENANTS WITH CARE
Also, in this difficult economic environment, you’ll need to pick your tenants with extra care. So, make sure you or your agent reference checks tenants even more carefully than before.
And if you have a choice, pick people who look well placed to stay in their jobs or who are bright enough to get another one if the axe falls on their current employment.
And treat good existing tenants well. If tenants are paying the rent it should go without saying that they should be treated fairly and with respect.
And if they cannot pay the rent, don’t be dumb and make them stay the course until the end of any fixed term of a tenancy agreement. If they are struggling to pay, this will not do them or you any good at all. So, cut your losses and let them leave early.

CHECK YOUR CREDIT SCORE
And if you have not already done, so you should check your credit record and credit file and make sure what information the agencies hold on you is correct.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of LettingFocus.com - the property investment experts.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 3 years has been the UK’s top selling property title - Buy Successful Property Letting - How to Make Money in Buy to Let. The new edition is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property with no money down.
I’m an expert freelance property journalist, property speaker and a well known buy to let blogger
I contribute to newspapers and a host of property websites, write a number of columns in the press and I provide general property investment training & advice
In my work as a consultant I help private individuals with any aspect of property investing or buy to let. What’s unique about lettingfocus.com is that we are independent property mentors because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.
We simply give one to one unbiased advice and are often asked to evaluate other property investments.
In my corportate consulting role, I also advise banks, building societies, housing associations and web portals with their buy to let and property products and services.
You can read more of my blog & find details of my networking, advice and property training programme at my website.Copyright: David Lawrenson 2008. This blog is updated once a week. WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
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Mortgage Lenders Cutting Out Brokers. Plus A Comment on Gumtree from Lawrenson of LettingFocus.com

MORTGAGE FIRMS CUT OUT MORTGAGE BROKERS
Another rather laughable consequence of the credit crunch and how UK mortgage lenders have responded to it is the way that lenders have now closed some of their best mortgage deals to brokers.
The fact is that most buy to let mortgages have hitherto been arranged mostly through mortgage brokers. This might seem strange in itself as volumes now match the numbers of first time buyer mortgages taken out. In other words, buy to let ought to by now be a core part of many banks and building societies business.
But go into any high street branch or ring one of their dark satanic call centres and ask about a buy to let mortgage and then ask them a simple question, for example “What is a tenancy deposit scheme?” and you will draw a complete blank along the lines of “Sorry, Computer says No”
Try it, its fun!
The fact is that most bank and building society staff have not got a clue about buy to let. So it will be interesting to see whether they now try to completely cut the mortgage broker out of the buy to let arena.
Unless they massively improve the training of their staff and the quality of the info they provide directly, they will be on to a loser if they do! And if I were a broker I would not forget any bank or building society that messes them around now when the good times roll again.

HOW GOOD IS GUM TREE?
Gumtree is a popular free site where landlords can directly advertise property to let for no charge without having to go through an agent.
OK, you need to update your ad every day to stay top of the list so would-be tenants can find you but hey, nothing is without cost.
Gumtree is very strong in London and I understand it also works in Manchester quite well, though it is a bit weak (or even non existent) in one or two other spots where I have property.
I’m telling you all this because I have been marketing one of my properties on it recently and have got a high level of response - and much better in terms of numbers than I’m getting from some of the other “only available to letting agencies portals”
But anecdotally I often hear that the sites that are only available to agents DO tend to get tenants who are able to pay a higher rent. Maybe that is a function of the demographic of tenants and the success of Rightmove’s and other portals branding. I’m not sure.
The facts often seem to be that a good letting agent will be able to get a higher rent than you can doing it yourself & often more than covering your fee to them -which should be no more than 8% on a 12 month tenancy term by the way.
But back to Gumtree and the like….If you are letting directly using one of these free to landlord sites, you’ll come up against the Great British Public (well if you are in London, the would-be tenants won't actually be from Britain, but the same “people based rules” still apply!)
Inevitably, you’ll get calls from people who say, “It sounds great, we just have to see it today.”
They always sound all super-keen and naturally have immaculate refs & I have often gone out of my way to do a viewing.
Now, I have learned my lesson because inevitably, these sorts of people always turn out to be the most dreadful timewasters who will want you to knock 10% off the rent and actually have very poor references indeed.
It does not matter where in the world they come from, there seems to be in all populations and peoples an equal number of people who are very pushy but very wasteful of others time.
I have found that the ones who will REALLY want to rent my places and who are straight talking and positive are always those who are polite and a bit laid back on the phone. They are not pushy but easy going and will view the property when you can fit them in.
We are taking a break for a week. Next post will be in 2 weeks time.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson a buy to let experts from lettingfocus.com.
I’m the author of “Successful Property Letting - How to Make Money in Buy to Let” which for the last 2 years has been the UK’s top selling property title: buy the UK's top selling property investment book
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying property below market value. I’m an expert property speaker and a well known property blogger and I contribute to newspapers and a host of property websites, write a number of columns in the press and I can provide help for landlords
Check out where I was recently featured in the Daily Telegraph: http://propertyclub.telegraph.co.uk/Page/View/266
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services and am a regular speaker at property shows.
You can read more of my blog & find details of my networking, advice, property investors networking programme at my website.What’s unique about lettingfocus.com is that we offer property investment mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, a developer, an agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated once a week. Permission must be sought before using the material in the blog.

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Below market value property, BMV - One good tip from LettingFocus.com

What is the best way to get a good deal when buying property?
Well there are many ways to get good deals.
However, in today’s blog, I just thought I’d highlight one particular technique that always works well when you are viewing a property and the vendor is showing you around.
As you go around, the key thing of course is not to give much away, whilst also trying to find out in a non pushy way as much as you can about the vendor’s circumstances in order to gauge if they will accept a hard offer. (It is also worth finding out what you can about the seller’s circumstances are in advance from the agent too.)
Then just as you are about to leave, you whip out the estate agents blurb on the property, pause for a few seconds and then just slowly say the price as if you were contemplating the meaning of life. Then allow the silence to hold for a few seconds. If the seller really wants to sell for less, they won’t be able to resist filling the gap by indicating what price they will accept.
It’s a great technique and it works most times. Try it.

FLOOD RISK
Now, a quick word about flood risk.
The property I am in the process of buying is close to a flood risk area.
To find out the extent of flood risk, all you need to do is look at the environment agency maps (at their website) and put in the postcode of the property.
This will bring up a general map of the area showing the extent of the flood risk – but this can actually vary a lot depending exactly where in the road the property is.
To find out the risk for a specific house you then have to click on the spot on the map at exactly where the property is. This will then bring up another more detailed statement which will state if the flood risk is “significant”, “moderate” or “low”. It is this which is the thing you really need.
Also, use Norwich Union too. They have among the most sophisticated flood maps in the UK which use other data which are laid on top of the environment agency maps – so if you are buying in an area that could be at flood risk, always call them for an insurance quote.
If they won’t cover you or charge a very high premium then you need to think about buying that property very carefully.

MORTGAGES
Out in the mortgage market mortgages are being withdrawn almost as soon as they show up and lending by the building societies continues to be restricted to certain areas and types of property. I continue to enjoy your stories about how hopeless the banks and building societies are at mortgage lending.
My friend Andy in Lancashire told me that “Despite being approved for a further £500,000 from the Woolwich in March for refinancing/new purchases, it seems I am not solvent enough for a 4,000k limit on a new capital one Cash Back credit card.”
I have had similar experiences too and I am also finding that the processing of mortgage applications by the lenders is still painfully slow. In my case, after having been approved for a mortgage from a subsidiary of one of our biggest banks I am still waiting after 4 working days to receive the application form. So, no change there then!
The same correspondent also says he accepts tenants on benefits and has noted that the rates for the new Local Housing Allowance were published yesterday by his local council for his area and they are pretty much 15-20% extra to tenants here when compared to the current HB system. The only downside is of course, that the money is usually going to be paid direct to tenants, so we lose the guarantee that we had when it was paid direct. So, we will have to see how this all works out.
If you need more advice on investment property or buy to let investments in general please ask me.
I’m David Lawrenson from property investment mentors http://www.lettingfocus.com/
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.
Buy the new edition here: http://www.amazon.co.uk/Successful-Property-Letting-Right-Plus/dp/0716030195/ref=sr_1_1?ie=UTF8&s=books&qid=1203933977&sr=1-1
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying below market value. I’m an expert on the UK property market and a well known property investment blogger and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.You can read more of my property investment blog and details of my networking, advice, buy to let networking programme at my website http://www.lettingfocus.com/My next London property investors networking meeting is coming soon. Click here for details: Property Investment Advice
I am also speaking at the Property Investor show in Birmingham in April http://www.propertyinvestor.co.uk/birmingham/
What’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.Copyright: David Lawrenson 2008. This blog is updated once a week. Permission must be sought before using the material in the blog.

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The signs say GO for house buying – just don’t tell the journalists, says Lawrenson of Letting Focus

House prices are down for the fourth month running according to the Nationwide. Their latest figures show a 0.5% drop in the month of February which leaves houses prices up 2.7% on an annualised basis
Just a word of caution, though, February 2006 was a strong month for houses price rises, so maybe that 2.7% growth figure looks a little worse than it is.
But notwithstanding that observation, it is clear that house prices are cooling a bit.
And as further evidence, the Land Registry has reported that the number of houses sold in November was 20% less than in November 2006.
Mortgage availability continues to get tighter too. As I sort of predicted in the last blog, other lenders have followed the Nationwide’s lead and are raising the amount that borrowers need to put in when they buy a property.
So, whilst, loans over 85% are still available they come at a much higher mortgage interest rate.
Of course, commentators who love to hate buy to let say, “Aha, all those landlords will have their come-uppance too from the new mean mortgage lenders”

Landord Default Rate is Low
The only problem (for these commentators) is that according to the Council of Mortgage Lenders buy to let borrowers still has a lower default rate overall than other mortgage loans, so landlord investors have not actually been hit as hard as ordinary residential borrowers by the tightening of lender’s criteria.
However, there has indeed been some tightening in buy to let lending – mainly on rent to interest ratios and on lending to borrowers who have a less than perfect credit history.
So, if you have a track record of investing in property and / or you have a good credit history and access to 20% of a property’s value, these are very exciting times.
Why?
Well, as lenders get meaner with who they will lend to, this is what will happen….
First, less people will be able to get mortgages to buy property
Second, the 1.4 million people have to re-mortgage this year may well end up paying a higher mortgage rate -and they may choose to sell their properties and rent instead.
Third, the tighter conditions and fewer buyers will cause house prices to slide - though this may not happen in earnest until around May. I predict house prices will be about 5% lower in December 2008 than they are now
Fourth, these conditions make it a great time to be in the market and buying property.
Why?
Because in a weak housing market, vendors will listen to offers and you will be able to get property at a good (i.e. low) price.
And because I think this year will be so good to buy property, I will be busy doing just that.
For that reason, and because of the demands of my consulting work, this blog will appear now just once a week.
However, we will endeavor to keep it as informative as ever.
If you need more advice on property investment or buy to let investment in general please ask me.
About Me
I’m David Lawrenson from property investment advisors http://www.lettingfocus.com/
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.
I’m an expert on property investing for profit and a well known property freelance writer and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.
You can read more of my property investment blog and details of my networking, advice, buy to let networking programme at my website http://www.lettingfocus.com/
Come to my next London landlords networking.
Click here for details: Property Investment Advice
What’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.Copyright: David Lawrenson 2007. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.

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Immigration flow may reverse says David Lawrenson of Letting Focus

One of the big threats to buy to let is the risk that the big flow of immigration may one day start to reverse.
New migrants generally rent and the huge numbers coming to the UK – we are talking millions but the fact is no one really knows least of the all the government – have pushed up demand for rented property.
However, the tide could be turning as the economies of the new EU member states strengthen. The numbers of east European immigrants approved to work in Britain dropped from 227,875 in 2006 to 206,905 last year, a fall of nearly 10 per cent, and the trend is expected to accelerate over the next decade. According to the Independent, “Poles, who make up two-thirds of the newcomers, are understood to be returning home in greater numbers, drawn by higher salaries, job shortages and the fall in the value of the pound against the Zloty”

Mortgage Rates
Also, in yesterdays papers was the threat that mortgages could get more pricey. The Head of the City Regulator the FSA said banks may be forced to keep loans on their own books in future rather than packaging them up and selling them off. This could have the affect of raising the cost of money. My view is that this fear is a bit overblown as there are still plenty of other sources of finance available like the building societies.
Meanwhile, in a separate move, Nationwide has raised the amount of deposit required for access to its best loans to 25%. I feel that this news is more significant for the housing market because this tightening of credit, if followed by other lenders, could lead to a bit of a donwturn in housing prices as borrowers find it harder to get funds. Possibly as much as 5 to 7% over the next year if others lenders follow suit.

Buy to Let Mortgage Rates
What about buy to let mortgages? As far as we can see lenders have now stuck another 20 basis points onto the cost of these loans relative to bank base rate than was the case pre-credit crunch days. However, buy to let loans are still available at 80% loan to value. So, if your credit rating is good, and you have access to money, the effect of all this will be that more property should be available to buy (to let) at lower prices than was available before.
Finally, I was quoted extensively in yesterdays Independent. Here is the link to copy into your broswer: http://www.independent.co.uk/life-style/house-and-home/property/investment-get-the-best-deals-ndash-now-787640.html
If you need more advice on property investment or buy to let investment in general please ask me.
I’m David Lawrenson from property investment advisors http://www.lettingfocus.com/
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.I’m an expert on property investing for profit and a well known property freelance writer and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.
You can read more of my property investment blog and details of my networking, advice, buy to let networking programme at my website http://www.lettingfocus.com/
My next London landlords networking meeting is on March 12th. Click here for details: Property Investment Advice
What’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.
Copyright: David Lawrenson 2008. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.

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Paragon may stop lending to new borrowers because of credit squeeze says Letting Focus

Buy to let mortgage specialist Paragon has said it may have to stop lending to new borrowers because of the credit squeeze. Paragon raises all its cash on the money markets not from savers and so it has been caught out by the crunch.
It has taken some products off the market and increased the prices on others.
As Paragon has no savers it cannot turn to Mr. Darling for help and has indicated it may raise money via a rights issue – issuing new shares to raise cash.
If this does not happen there will be doubts about its future – just as there were in its previous incarnation as National Home Loans back in the late 1980s – when it was last bailed out.

New Mortgage Rates
However, existing buy to let investors with loans from Paragon should not be under threat - though they may find Paragon’s new rates not to their liking when they need to re-mortgage.
Paragon is one of the largest lenders in the residential property investment sector, funding one in every ten buy-to-let loans. In general, it has tended to avoid new build flats, so it’s lending book may be attractive to bidders.
All this news is grist to the mill of newspapers that have long (very long) predicted the demise of buy to let. They are fond of saying that the falling number of buy to let loans and their rising cost could force some investors to sell.
And they reported with glee that no less an august institution than the Royal Institution of Chartered Surveyors has predicted that buy to let is set to become the preserve of the wealthy.

Preserve of the Wealthy
RICS has recently released figures suggesting that to purchase a buy-to-let property you now requiore a deposit of about £65,000 – effectively 30 per cent of the property’s value. They say five years ago, the required deposit was £10,000, or 8 per cent of the value of an average-priced property in the UK.
But whilst in theory borrowers needed to stump up only 8 per cent of the property value, the lending criteria in 2002 were much tighter, especially the rent to interest ratio which meant that lenders actually required investors to put down a deposit more like 15 or 20%.
So, I don’t share the pessimism

Buy in the Right Area
Buy in the right area and the right kind of property and you should do well - even if property prices do take a tumble over the next 18 months or so.
And as defaults in buy to let are still lower than the rest of the mortgage market, I don’t expect lack of credit will be a problem for long.
And despite what RICS says, there are still plenty of properties on the market, even for new-build flats, for which a 20 per cent deposit is (for now at least) perfectly satisfactory for most lender.

ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
We are LettingFocus.com - the property investing experts and I’m David Lawrenson, the author of “Successful Property Letting” - the UK’s top selling property book for the last 3 years.
What’s unique about LettingFocus is that I offer independent unbiased
property newtowrk seminars covering property investment and letting because unlike most people in the buy to let and property “advice” business I am not linked to a property company, developer, agent or bridging loan financier.
I can tell you where to buy (which areas), what type of property to buy, when to buy, how to buy it at a low price, how to make sure you get tenants who are going to stay & pay the rent and how to manage it.
I have been a landlord and property investor myself for over 25 years.

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Mortgage companies tighten buy to let lending by LettingFocus

There were some interesting bits of news from the weekend financial press.
First off is the fact that Alliance & Leicester is to restrict lending on new build flats to 70% loan to value amid continuing concerns that prices of new build are falling in many areas and there is a big oversupply problem -too many flats and too few tenants causing landlords who have bought into these places to struggle with falling rents and capitals values.
Those who came to see me speak over the last few years will be well aware that I’ve warned of a big problem to come with identikit flats. Well, now it’s here!
Second, Paragon’s shares were under pressure last week. Paragon is one of the biggest buy to let mortgage lenders. Formerly, known as National Home Loans, they struggled in the credit crises of 1989-1990, when they had to be bailed out. Just as in 1989, they still raise nearly all their money from the money markets -so this really is a case of history repeating itself.

Will Buy to Let Become a Rich Man's Game?
Third, mortgage lenders’ continued tightening of lending criteria in the buy to let market has led RICS to say that buy to let will be a rich man’s game from now on.
I don’t think it’s that bad, but if you have not been in buy to let before you are going to have to find at least 20% of the value of a property – and probably 25% from your own funds from now and for a little while.
So, yes it will get harder for the novice.

Gifted Discounts and No Money Down
But if you are a new to buy to let and you don’t have at least 20% to put in, please don’t be tempted to listen to all the guff about “gifted discounts” on new build and bridging loans to buy below market value – if you do, you are only asking for trouble further down the line.
Sorry to say, but if you cannot really afford to get in, don’t play the game.

ABOUT LETTINGFOCUS.COM
We are LettingFocus.com - the property investment experts and I’m David Lawrenson, the author of “Successful Property Letting” - the UK’s top selling property book for the last 3 years.
What’s unique about LettingFocus is that I offer independent unbiased
property information and one to one advice covering all aspects of being a landlord and investing in property.
Unlike most people in the buy to let and property “advice” business I am not linked to a property company, developer, agent or bridging loan financier.
I can advise where to buy (which areas), what type of property to buy, when to buy, how to buy property at a low price, how to eliminate the risk of getting a bad tenant and more. I have been a landlord and property investor myself for over 25 years.

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Read our article on Getting a Mortgage from a Broker
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Mortgage Company May Cost You says Letting Focus

I read in the Daily Telegraph, 3 great quotes from Warren Buffet, the “Sage of Omaha” and one of the world’s most brilliant stock market investors.
He was talking about stock market investments, but his comments could equally apply to buy to let – and the way that many novice investors have bought the wrong kind of property, egged on by property companies / agents masquerading as property experts.
Here are the quotes:
On investing generally - “Never invest in something you don’t understand” and “Seek only to be fearful when others are brave and brave when others are fearful” (I kept that quote in mind when I bought Barclays stock last week!)
On the credit crunch – “You only find out who was swimming naked when the tide goes out”
Great stuff isn’t it.

Mortgage Lenders
Of course, readers of this column will already know my opinions of those robbers – the mortgage lenders.
On this subject, I see mortgage lenders are now cashing in again. David Whittaker of Mortgages for Business was quoted by the Residential Landlords Association.
He pointed out that nervous investors were buying short-term fixed-rate mortgages that may be inappropriate.
This is because whilst many buy-to-let lenders are offering extremely competitive headline rates, they are gaining their margin through massive arrangement fees of up to 3% that can be added to the mortgage - and hence repayments.

Most Competitive Mortgage Deals
Of course, those with savvy will know that finding the most competitive mortgage means looking at the fees as well as the mortgage headline rate so you can see whether it is a good deal overall.
As a long term finance strategy for those holding on to property short term fixes are rarely appropriate.
Surely, the only reason for brokers and lenders offering these mortgage deals to buy-to-let investors is the potential re-mortgage business in 12 months’ time -i.e. another chance to get more commission for the broker and another juicy “arrangement fee” for the lender.

ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
We are LettingFocus.com - the landlords’ expert and I’m David Lawrenson, author of “Successful Property Letting” - the UK’s top selling property and buy to let book for the last 3 years.
LettingFocus provides independent unbiased seminars for property investors and one to one advice covering all aspects of being a landlord and investing in property.
Unlike many in the still largely unregulated buy to let and property “advice” business I am not linked to a property company, developer, estate agency or bridging loan provider.
I can advise where to buy (which areas), what type of property to buy, when to buy, how to buy property at a low price, how to eliminate the risk of getting a bad tenant and more. I have been a landlord and property investor myself for over 25 years.

CHECK OUT THESE PAGES AT OUR SITE LETTINGFOCUS.COM:
Our Events only take place twice a year. For our NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors click here:
Next Property Seminar and Networking Event
Find out about GREAT DEALS we have arranged for landlords by clicking here: Services and Products for Landlords and seeing our Landlords’ Resources (Useful Links) page.
If you sell products to landlords and property investors and you have national coverage and would like to be on this page as a partner, please get in touch!
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
ONE TO ONE CONSULTING click here: Property Consulting
CLIENT TESTIMONIALS from past customers click here: Testimonials
BUY THE BOOK click here: Buy the Book at Amazon
THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
To JOIN our Free QUARTERLY NEWSLETTER simply send an email to [email protected] - Please note we WILL NOT send spam or sell our mailing list to advertisers!
Related Article: Have you seen this article on unfair mortgage fees?: http://www.lettingfocus.com/pages/myarticles_Unfairmortgage.html

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Mortgage companies now charging interest in advance says Letting Focus

Is there no end to the mortgage lenders desperate attempts to squeeze money out of borrowers to make up for ever lower headline mortgage rates?
In previous blogs you will know how I have commented on how so called “arrangement fees” have gone ever higher.
They are now so ridiculous that the lenders have now dropped the term “arrangement” when referring to these fees - possibly for fear of being done by the trade descriptions people.
I have also shown in past blogs how you can save money on mortgage lenders’ rip off valuation fee by going straight to a surveyor for a valuation or survey and also, how, by making a simple call to your lender you should be able to reclaim previously unfairly high arrangement fees.
But still the lenders come up with ever more smart ways of making money.
I have just realised that my lender now deducts interest in advance, rather than in arrears. They put this sneaky change in around June 2005.
How much extra did that clever idea make for them I wonder? Quite a lot, I suggest.

ABOUT DAVID LAWRENSON and LETTINGFOCUS

LettingFocus.com are the experts on landlord issues and I’m David Lawrenson, the author of “Successful Property Letting” – which has been the UK’s top selling property and buy to let book for the last 3 years.
We help landlords and property investors make money in property by coaching them in ways that work, that are ethical and which involve minimal risk.
I have been a landlord and property investor myself for over 25 years.

At LettingFocus we offer independent unbiased buy to let advice for property buyers and landlords both on a one to one mentoring and coaching basis as well as through occasional group seminars.

Property syndicates and property advice in the UK is still largely unregulated and “advice” is more often more about making the promoter money than giving useful information
With no link to property firms, developers or bridging loan providers, at LettingFocus, we aim to give unbiased independent advice on where and what type of property to buy for investment, when to buy and how to buy property at a low price.
We also show you how to manage tenants properly and in ways that take up as little of your time as possible.

CHECK OUT THESE PAGES AT OUR SITE LETTINGFOCUS.COM:


THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investing Seminar and Networking Event
We have GREAT OFFERS on a range of products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
ONE TO ONE PRIVATE CONSULTING click here: Property Mentoring
CLIENT TESTIMONIALS from past customers click here: Testimonials
BUY THE BOOK click here: Buy the Book at Amazon

To JOIN our Free QUARTERLY NEWSLETTER simply send an email to [email protected] - Please note we WILL NOT send spam or sell our mailing list to advertisers!

IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR OUR WEBSITE?

Selling services to landlords and property investors and have a national coverage? You could be a partner, please get in touch!

TO VIEW RELATED POSTS select a “Category” at the bottom of this page.
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