The Cambridge Building Society is reintroducing top slicing to its standard buy-to-let range, opening doors wider for those looking to expand or step into the property rental market. This move is especially beneficial for experienced landlords who might find themselves short on the required lending amount due to insufficient rental income from their investment properties.
What is Top Slicing?
Top slicing allows landlords to supplement the rental income evaluation with a portion of their earned income elsewhere. This means that if the rent your property generates isn’t enough to meet the lending criteria on its own, your other income sources can be considered to fill the gap. This adjustment is crucial for securing loans up to an 80% loan-to-value (LTV) ratio, providing much-needed flexibility in the financial assessment process.
A Boon for Fixed-Rate Fans and New Investors
For those who prefer the stability of a five-year fixed-rate mortgage, The Cambridge offers an even sweeter deal. The rental income calculation for these loans will be based on the pay rate alongside a rental coverage ratio of 140%. This approach can make it easier for landlords to qualify for financing by aligning with the actual costs and income related to maintaining rental properties.
Moreover, The Cambridge is extending a warm welcome to first-time landlords, including expatriates who already own a residential property and are looking to venture into the buy-to-let or holiday let market. This inclusion demonstrates The Cambridge’s commitment to fostering a diverse range of investment opportunities within the real estate sector.
International Reach with Few Limitations
An impressive feature of this policy update is its global inclusivity. The Cambridge is ready to consider landlords dealing in all countries and currencies, provided they’re not from regions on the UK Government Financial Sanctions list. Financing options are available up to 75% LTV, broadening the horizon for international investors and expatriates aiming to tap into the UK’s lucrative property market.
A Response to Market Needs
Kathy Bowes, the intermediary manager at The Cambridge, highlighted the initiative’s motive. “We continue to listen to our intermediary partners and understand the difficulties that can occur in trying to find a suitable lender to submit a buy-to-let case with. We hope that these criteria enhancements will help to offer more choice within the buy-to-let marketplace.”