Buy To Let Mortgage Credit Crunch

Many investors are now turning to bricks and mortar as opposed to stocks and shares.

To assist the increased popularity of property investments lenders have created more and more new products especially for buy to let, self-certification and sub prime.

As property prices have increased lenders have offered better lending criteria.

Now everyone is wondering what affect the credit crunch will have on the buy to let market.

With buy to let and sub-prime sectors criteria has become more lax. Competition has pushed lenders into increasing maximum loan to value ratios, reducing requirements for rental cover and have been accepting 100% rental cover or even none at all.

Many lenders are entering this market and are offering generous underwriting criteria. The buy to let Mortgage market is less risky than sub-prime because if investors cannot make good returns they can sell that property unlike sub primes who would lose theirs should they do the same.

There is likely to be tightening of criteria but with such high demand for rental property the buy to let sector is less of a risk than sub-prime because of its good repayment record.

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