Keystone announces underwriting policy for portfolio landlords
Keystone Property Finance will be introducing a new underwriting policy for portfolio landlords, to comply with the guidelines issued by the PRA.
Whether borrowing personally, or via a limited company, applicants with four or more mortgaged properties will now be subject to stricter underwriting.
Keystone will ask that all portfolio landlords provide an up-to-date property portfolio spreadsheet, which will need to be submitted in a standard format alongside the full mortgage application.
To help with this, Keystone will launch a tool for brokers, which will enable them to convert their clients’ portfolio spreadsheet into the required format.
Steve Olejnik, COO of Keystone said:
“The additional information required from portfolio landlords will of course equate to a much heavier workload for brokers and their clients’. To ease the process, we are releasing a tool which will enable brokers to convert their clients’ existing portfolio spreadsheets into the format required by Keystone.
“It has always been our aim to try and keep this process as simple as possible, so we hope this tool will be welcomed by both brokers and landlords.”
From 30 September portfolio landlords, will now have their entire portfolio stressed to ensure it works at 125% @ 5.5%, regardless of whether the new application has been made in the name of an individual or limited company.
Keystone will also require each property within the portfolio to have 100% rental cover and portfolios geared above 80% will not be considered.
If a portfolio passes the initial rules, Keystone will then use an automated valuation model to verify a landlord’s valuation and rental figures.
To recognise the increased workload that brokers will be taking on, Keystone has increased the proc fee paid to brokers by 10 basis points on all classic range cases.
As far as non-portfolio landlords are concerned it will be business as usual, without the portfolio spreadsheet requirement.