Buy to let self certified funding under threat
Despite the fact that the buy to let market was, at least in the 80s and 90s, a hive of activity in the UK, with many landlords obtaining mortgage funding using so-called "self certified" income statements, this particular avenue is under threat for the future. Buy to let mortgages may now be pulled under the watch of the Financial Services Authority in a move to bring everything under one roof and ensure that regulations are consistent across the board.
There is no doubt that a number of buy to let landlords have overstretched themselves in the short to medium term and indeed many have fallen behind with their mortgages and have seen some of their assets repossessed. Due to the way in which many people built their property portfolios, using older assets to cover new investments, a domino effect has been encountered by many and seen some property portfolios literally collapse to the ground.
Bradford & Bingley is one company in particular which make good money in the buy to let market, when the property sector was riding high, but was hit hard when the sector began to fall away. As we saw, the company was bailed out by the UK government with the authorities taking on the riskier mortgage asset book and the branches being sold off to a third party. One thing is for sure, the UK buy to let market will never be the same again!
Share this..
Related stories
Will the Bank of England be taken back under government control in the future?
The last few months have seen the differing strategies and opinions of the Bank of England and the government come to the fore at a time when the UK economy needs all parties to be pulling in the same direction. This has raised the fascinating question as to whether the government will look to take more control of the Bank of England in the future, and realign its strategy with that of the governm...
Read MoreMarks & Spencer cautious on year ahead
Despite announcing a 4.6% rise in pre-tax profits to £632.5 million, UK retail giant Marks & Spencer is still concerned about the short to medium-term outlook for the UK economy. Like for like sales increased by 0.9% over the 52-week period in what is the last set of figures reported by Sir Stuart Rose, the outgoing chairman. The company is now in the hands of Marc Bolland although he has take...
Read More£20 billion and counting!
The Bank of England has injected another £20 billion into the ailing UK money markets as yet more doom and gloom descends upon the Square Mile. News from the States would indicate that AIG (the largest insurance company in the world) has only 24 hours to sort itself out and stave of bankruptcy. This for a company with investment assets totalling over $1 trillion is truly breath taking and many...
Read MoreWould a Robin Hood tax be passed on to consumers?
As the clamour for the introduction of the so-called "Robin Hood tax" continues to grow, there are concerns that introduction of a tax on every financial transaction in the world would effectively be passed on to consumers. The truth is that the vast majority of taxes and additional costs targeted at the financial sector, or any other sector for that matter, are almost inevitably passed on to cons...
Read MoreBoris Johnson attacks unions
Boris Johnson, the Lord Mayor of London, has today issued a stinging attack on the UK unions claiming that new legislation is required to ensure that at least half of union members actually vote on strike action. This comes amid further disruption on the London Underground which will leave around 30% of services running today and will in many cases bring the city to a standstill. There is no do...
Read More