| news home | subscribe | submit an article | pre-Sept 09 news archive |
|
|
|
© Business Money Ltd 2010 |
|
|
If you're not
communicating with your clients, who is? |
|
|
Business Money Magazine |
Mark Aston, broker development manager, commercial intermediary mortgages, Santander Business Banking, confirmed that following recent talks with Santander’s risk department the following changes to the credit policy have been made: Partly amortising facilities - Real estate credit policy has been amended to allow LTVs at expiry of loan term to be increased from 40% to 70% The credit policy has therefore been amending to reflect the following: · Fully amortising loan (max term 30 years) · Partially amortising term loan (maximum 15 years). Where partially amortising the maximum debt outstanding at loan expiry is to be a maximum of 70% LTVPV. Partially amortising facilities are only available to high quality deals with good lease conditions and tenants LTV for industrial units - Policy LTV’s are increased from 60% to 70% Loans for capital raising · The maximum term for capital raise loans is extended from 15 years to 25 years · However, the purpose of all funding must be clearly identified · The capital withdrawal should not be to the detriment of the business · Underwriters reserve the right to apply assessment and conditions as appropriate (ie excessive withdrawal of directors loans) Use of outside personal income to support lifestyle businesses - For lifestyle businesses, where owners often rely on the continued outside income of one party, policy is amended to allow the use of surplus income to meet stress rates only. Policy has been amended thus: · Where business owners live in the business premises (eg guest house) and one party has outside salaried income, the net income (after deduction of all personal expenses and borrowings) may be added to the net business income to assess stressed serviceability. Full income and expenditure statements must be provided. However, the business must be able to meet at least 1x cover for serviceability on a standalone basis Stress rates for investment property - Ad hoc reductions in rental income to account for voids etc have been removed. These are incorporated within the new stress rates detailed below: · ERV or passing rent (whichever is the lower) x 90% to be covered; Other Business Money News
| ||||||||||||||||||
