Overseas lenders swoop on high-end buy to let sector
News Category: Industry News
Published: 30-Jul-2008
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Overseas lenders are capitalising on the withdrawal of UK banks from the high end of the buy-to-let sector, it has been claimed.
According to Gary Festa, mortgage specialist at HFM Columbus, foreign lenders such as Handlesbanken, Kleinwort Benson, Bank Leumi and EFG Bank are targeting the market for £1m plus loans in the absence of their British rivals.
He explained: "Our own lenders have effectively pulled the plug on this market altogether.
"But where do buyers go when they want to get their hands on the big money? Current market conditions have given rise to tremendous buying opportunities, and now we have a situation where foreign investment banks are swooping."
To support his assertion Mr Festa cited the example of Handelsbanken's recent offer of a £2m loan at 1.4 per cent above the base rate for three years.
The deal, which is subject to a review after the intial three year term expires, also afforded the borrower an offset facility.
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