Residential lending has seen many changes over the last ten years since the end of the recession and most of the significant ones have taken place in recent times. The residential market is still very strong with good demand and not enough good quality properties in the right areas. Inflation has remained for the most part within Government guide lines and with low interest rates there are in some areas not enough properties to satisfy demand. The demand for new properties is very strong for owner occupiers and investors in the BUY TO LET market.

The poor performance of pension funds has driven a large section of investors to consider bricks and mortar as a safe haven for their money with a low risk. Lenders have seen the changes in our life style and most lenders including the high street lenders who have in the past been a little conservative are now offering BTL mortgages. Because of the strong demand lenders have now become far more positive about lending and providing the clients obtain a good credit score income multiples have been stretched and where a good deposit is available some lenders will consider affordability rather than x times income. This is a revelation in lending particularly when the normally conservative lenders have taken to this like a duck to water and offer Financial Advisers the opportunity to use their online calculators to work out what the client can afford.

Having a good credit score is current buzz word and gives lenders that comfort zone that if a potential client has managed their financial affairs in a satisfactory manner they are worthy of a smile and extra borrowing potential. It was almost unheard of for high street lenders not to check income but now with the right loan to value and credit score lenders are offering Express Underwriting. One lender has been pushing the boundaries with lending up to 125 % of the valuation and shows no sign of changing the guide lines. Again confidence in the property market has allowed lenders to be more generous with their underwriting. Another change has been the need to always survey the property, again providing we have enough equity in the property lenders will rely on information held on record which would suggest that a property in a given area of a certain size and construction would value at the claimed value.

This facility is normally used for re mortgages but watch this space, one of the new lenders to launch recently is already promising an instant offer. Lenders are now looking to provide innovative schemes to help new borrowers to get on the housing ladder assisted by some help from the government, who realize that a strong housing market is good for the Country and our economic growth. Lenders have also been far more understanding about clients with a Bad Credit history. There are a number of specialist lenders who have schemes designed for those who have had a blip in the past and clients should seek the services of an Independent Financial Advisor who has access to the whole of the market and can advise the client what is the right scheme for them. Most IFAs will run an agreement in principal across the market with a specialist packager to ensure that they have a recognised audit trail to confirm that the correct advise has been given. It will not be long before all the high street lenders offer similar schemes.