Merrill Lynch-owned Mortgages Plc has confirmed it will be changing its lending criteria due to the volatility of the global capital markets.
The lender will be reducing its LTVs on its unlimited range from 80 per cent to 75 per cent. It will be reducing its heavy range LTVs from 85 per cent to 80 per cent.
Its sub-prime buy to let applications are now being limited to near prime plus, near prime, super light and light.
MPLC also says that borrowers in arrears with a non-conforming lender will only be accepted in future on near prime and super light.
Marketing director Ian Whittaker says: “The continued volatility of the global capital markets has led a number of specialist lenders to either tighten their lending criteria or withdraw products from the mortgage market entirely.
“Mortgages plc continues to be committed to the sub-prime mortgage market and is not withdrawing any products, but we are making adjustments to lending criteria to limit our exposure to higher risk categories of business, which we believe is prudent given current market circumstances.”
The changes will be effective from September 3.