Furness Building Society's Mortgage Transformation: What London Landlords Need to Know About New Lending Criteria

Introduction: A Strategic Shift in Buy-to-Let Lending

Furness Building Society has launched a mortgage transformation programme aimed at improving access to finance for borrowers with complex income profiles and non-standard cases. For London’s private landlords, especially those with diverse portfolios or non-traditional income streams, these adjustments could impact financing options and strategic planning.

What Has Changed?

The key updates announced by Furness BS include:

• Loan-to-Value (LTV) Limits:
  • Up to 95% LTV for complex income borrowers such as contractors, limited company directors, and new business owners.
  • Up to 80% LTV for regulated buy-to-let and holiday let mortgages.
  • Up to 75% LTV on short-term loans.

This represents a notable loosening compared to many mainstream lenders, particularly benefiting those with irregular earnings or emerging businesses.

Why These Changes Matter to London Landlords

London landlords represent a diverse group — from single-property accidental landlords to large portfolio holders and HMO operators. These criteria adjustments matter because:

• Improved Access for Complex Income Borrowers: Many landlords, especially those with mixed income streams (e.g., contractors, freelancers, small limited companies), often struggle to secure competitive lending. Furness BS’s 95% LTV tier acknowledges this complexity.

• Higher LTV for Regulated Buy-to-Let: An 80% LTV limit is relatively generous within the current market, potentially reducing the upfront capital landlords need, improving cashflow, and enabling portfolio expansion or refinancing.

• Holiday Let Inclusion: Recognising holiday lets as a regulated product formalises this niche but growing market, opening tailored financing options.

• Short-Term Loan Terms: Up to 75% LTV for short-term loans signals flexibility in financing shorter holding periods or refurbishment projects.

Practical Implications Across Landlord Operations

Financial Planning and Portfolio Strategy

Landlords should reassess their financing strategies in light of increased LTV limits. Those previously constrained by deposit requirements can explore refinancing or new acquisitions with lower capital outlay. However, it remains critical to evaluate affordability and rental yield assumptions carefully to mitigate risks.

Compliance and Documentation

Given the emphasis on complex income and manual underwriting, landlords and agents must prepare more detailed documentation — including contracts, business accounts, and evidence of income streams. Early engagement with mortgage brokers familiar with Furness BS’s criteria will smooth application processes.

Letting Agent Advisory Role

Agents advising landlords should:

• Update their knowledge of Furness BS’s new criteria to provide accurate mortgage guidance.
• Verify client eligibility meticulously, particularly for borrowers with unconventional income.
• Coordinate with lenders or brokers to understand and prepare for additional documentation requirements.

Considerations for Different Landlord Profiles

Next Steps: Action Plan for Landlords and Agents

1. Review Furness BS lending criteria documentation to fully understand updated eligibility and LTV limits.
2. Assess current mortgage positions and identify properties or borrowers who could benefit.
3. Engage mortgage brokers or directly with Furness BS to clarify manual underwriting requirements and documentation standards.
4. Plan portfolio strategies considering the improved LTVs, particularly for landlords with complex income sources.
5. Schedule training or update briefings for letting agents to ensure consistent and compliant client advice.
6. Monitor further updates as the mortgage transformation programme proceeds throughout the year.

How Rentals & Sales Can Support You

Our team specialises in guiding London landlords through evolving mortgage and compliance landscapes. We offer comprehensive services including:

• Portfolio reviews with an eye on refinancing opportunities under new lending criteria.
• Compliance audits to ensure documentation readiness and risk mitigation.
• Bespoke pricing strategies aligned to current lending environments.
• Liaison support with mortgage brokers to optimise approval chances.

Contact us to schedule a consultation tailored to your portfolio profile and strategic goals.

Compliance disclaimer: This article is intended for educational purposes and does not constitute financial advice. Landlords should consult directly with lenders or qualified mortgage advisors before making financial decisions.