COVID-19 FAQs For Landlords
Everything You Need To Know About COVID-19 & Your Mortgage
We want to help keep you as up to date as possible with all of the latest developments with the recent outbreak of COVID-19 (Coronavirus) and what this all means for your property business, your responsibilities as a landlord and how you can safeguard your portfolio in this uncertain time. Here are all of the top questions that we have been asked by our clients recently.
If you still have questions, don’t worry our entire team are on-hand to help. We can offer you contactless advice wherever you are, via our robust remote working and technology platforms, so feel free to call us on 08009499410 now.
Will The Change In The Bank of England Base Rate Affect My Mortgage?
The Bank of England has reduced the base rate twice in the last few days in emergency response to COVID-19, with the latest reduction from 0.25% to 0.10%; an historic all-time low. How this will affect you will depend on the type of mortgage you currently have. For example if you are on a ‘Base Rate Tracker’ you will have heard from your lender with details over when your payments will reduce. If you are sitting on a lenders ‘Standard Variable Rate’ or SVR however, this will be at the lenders discretion as to how they set their rates in future. If you are on a fixed rate mortgage, there will be no change to your current payments or rate.
We strongly recommend that you speak to one of our advisers to establish exactly how this may affect your portfolio in an effort to keep your mortgage rates as low as possible.
Can The Base Rate Decrease Further?
The base rate is already at an historic low of 0.10% and it’s therefore unlikely to be reduced further. However, the Government has not ruled out any further emergency measures since the current situation is so unprecedented. According to the Bank of England website, the base rate is next due for review on Thursday 26th March, 2020.
I Have A Buy To Let Mortgage Application In Progress, How Will The Outbreak Affect This?
Having robust remote working already established within our business means that our entire team will continue to manage your application with little to no disturbance to our service, we’ve worked hard to ensure that our technology is up to the minute. It’s highly likely that we’ll be in constant touch with you already, but as ever if you have any queries regarding your application/s, please get in touch with your dedicated broker or case manager. Of course if you’d like us to review any of your other mortgages, please ask – we’ll only be too happy to help.
Since we never stop finding the best best available deals for our clients, we are actively monitoring the market and we will update you if a more cost-effective option to slot into your portfolio becomes available before completion.
Am I Eligible For A Three Month Mortgage Payment Holiday?
In a bid to help homeowners, tenants and landlords alike, the Government has asked mortgage lenders to offer a Mortgage Payment holiday of up to three months for private landlords whose tenants have been impacted by the Coronavirus outbreak. This comes with the expectation that landlords will offer the same three month rent holiday to any tenants should they need it.
However, not all lenders are supported by the Governments ‘Term Funding Scheme’ or TFS. Lenders that raise money on the wholesale markets or through institutional investors or Peer to Peer funds, may not have the same financial backup to assist you. Also, lenders do not have to assist landlords who have borrowings within a corporate of SPV structure, although they may well still assist.
**If you are considering taking advantage of this offer to temporarily stop your payments, it is important to remember that the Mortgage Payment Holiday will only delay your payments, not remove them completely. This could well mean that you take a payment holiday during a low fixed rate period but may end up paying a further 3 months Standard Variable Rate which could be much higher than the rate you are currently paying, it may also extend the length of your mortgage. All important factors to consider before taking up the offer, especially where it will cost you more in the long run.
Always check exactly what the terms are before starting a payment holiday. The Buy to Let Broker can assist you to raise capital at this time, should you need it.
My Tenants Have Said They Can’t Pay Rent, What Do I Do?
We are all facing unprecedented times, with the impact of the outbreak being felt by homeowners and renters alike. As a landlord, it is important that you are in communication with all of your tenants to fully understand their situation so that you can quickly identify any risk of rental voids.
If You Still Have Questions, We Have Answers!
To get the answers you need, simply pop your details in the form below and one of the team will be in touch to get you sorted. If you are in a rush, you can also call us on 08009499410 now.