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Nationwide U-turns on BTL benefit mortgage decision

Nationwide-Building-480

The Mortgage Works, Nationwide’s buy-to-let lending subsidiary has U-turned on its decision to stop lending to landlords who have tenants on housing benefits.

This week, Money Marketing revealed TMW had altered its criteria and had stopped new lending to landlords who have tenants receiving housing benefits, except in remortgage cases.

Prior to the decision to exclude landlords with tenants on housing benefits, the lender, which has a BTL market share of around 20 per cent, would judge each application on a case-by-case basis.

The lender says its reversed the decision after customer feedback.

Nationwide divisional director of mortgages Richard Napier says: “The buy-to-let sector is very important to us.  We have listened to concerns that have been expressed by some of our customers, over the last few days, and believe this is the right way forward for The Mortgage Works, for landlords and for their tenants.”

There are around 3.8 million households in private rented accommodation, 26 per cent of which – 982,000 households – receive housing benefits, according to Government figures.

Other lenders which will consider tenants on housing benefits include Aldermore Commercial, Manchester Building Society and Paragon and Mortgage Trust.

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Comments

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

  1. You would have thought an actual mortgage lender could have worked out what is and is not good lending rather than rely on comments from customers in order to set its lending policy. The u turn explanation is almost as shakey as the reason for changing policy in the first instance.

  2. How can anyone complain that a lender is listening to brokers? Yes, It would have been better to avoid embarrassment by sounding out their customers first, but it is a good response and a positive move.

    If only Nationwide listened to us and stopped dual pricing, they would gain a great deal more respect.

  3. John Constable 1st March 2013 at 6:41 pm

    On the issue of dual pricing, maybe I’m missing something but if you the lender, have a middleman who needs a cut, then surely this is why dual pricing exists?

    Maybe there is something blindingly obvious that I have missed, in which case, any brokers reading this can explain why they ‘add value’ to justify their cut as opposed to going direct.

    I mean for the ‘bog-standard’ cases, not unusual situations where it is clear that the brokers expertise gets the funding when ‘going direct’ would fail.

    PS. I am not Tony Hazell in disguise although some might think so.

  4. Worrying that Nationwides decision making process appears more akin to kids choosing sweets in a shop!

    You would have thought that they would be aware of the numbers on benefit before they made the decision . It appears they were not then realised hoe much business they could loose

    yet another strange decision from them to go with many others

    A confused mutual

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