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Nationwide scraps remortgage applications for buy-to-let

Nationwide is no longer accepting remortgage applications to fund buy-to-let investment.

Nationwide’s buy-to-let arm, The Mortgage Works, will accept remortgage applications to fund buy-to-let, but not from Nationwide customers.

A spokeswoman for Nationwide says: “As part of Nationwide’s move to a single mortgage processing system, the society is streamlining a small number of specific lending scenarios and reducing manual processes.

“As a result, additional lending to existing Nationwide residential mortgage customers to purchase a second property, where the new property is to be let out, is no longer available.”

Brokers say the lender’s policy on buy-to-let is contradictory.

Perception Finance managing director David Sheppard says: “This policy does seem confusing, given that Nationwide is in the buy-to-let sector through TMW, yet Nationwide itself will not consider such deals.

“It does seem strange that two companies under the same group have different policies towards lending.”

Buy-to-let brokerage The Buy To Let Business managing director Ying Tan says: “This is a rare policy among buy-to-let lenders, most of whom will accept a remortgaged residential loan to fund a deposit. We have had experience of this with Nationwide but few other lenders seem to adopt that policy.”

TBMC managing director Andy Young says: “There have been restrictions on capital-raising through remortgages for business purposes, so this may be the reason for Nationwide’s decision. Even then, this is a confusing policy indeed.” 

The move to a new mortgage processing system has already seen Nationwide stop lending to brokers where the borrower is in the armed forces and based overseas.

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. If this is a “systems” issue as this implies then why not use another systems provider who can provide what is required. Other lenders can do it why not Nationwide?

  2. This would be the self-same Nationwide that this week withdrew their product range from sourcing engines without notice or notifying us, returning last night with a 30 BP rate rise on 90% products I presume!!

  3. The Cynical Broker 7th February 2014 at 11:42 am

    What’s their tag line again ? “Nationwide – We’re on your side!” (Unless you want interest only, or to capital raise to buy an investment property, probably to help fund your retirement or generally make a better return than you’d get on one of their savings accounts, have young children, etc…..)

    Seriously though, a big thank you to another high street lender restricting choice, and giving the public yet another reason to use a broker, rather than waste time trying to go direct!

  4. Thank you Mortgage Strategy for reporting this, as I wouldn’t have been aware, as no notification from the lender. This is what worries me with the post MMR rule of only sending cases that meet criteria, we need to know when changes occur. Well done MS

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