LendInvest is keeping its doors open for business ahead of the impending changes to Stamp Duty Land Tax.
In an almost boastful display of nimbleness, LendInvest has announced that it will continue to accept borrower applications despite the fact that we now stand 1 month away from the stamp duty tax hike. Stamp Duty Land Tax (SDLT) will be raised by 3% for landlords and developers on 1 April, as was first announced by Chancellor George Osborne in the Autumn Statement in November 2015.
LendInvest claims that the uncertainty surrounding the higher rate of SDLT has caused many lenders to shut up shop until after the dust has settled. LendInvest will continue to consider loan requests, for the time being at least, and does not have a strict cut-off point for applications in place. The platform has taken this decision due to – and indeed, as a testament to – its flexible and speedy underwriting processes.
Few traditional mortgage lenders would be able to close a loan request in less than a month. But prospective investment property owners will of course be keen to secure funds ahead of the tax hike – thereby opening a window of opportunity for the LendInvest platform.
Matt Tooth, Head of Distribution at LendInvest, commented:
“Borrowers should never let tax regime changes drive investment decisions. However, for people with property purchases in the pipeline already, our ability to review new applications for several more weeks means it may not be too late for them to avoid the stamp duty hike.”
“At LendInvest, we never applied a strict deadline for applications like many other lenders had to, because we handle each and every deal on a case-by-case basis and can apply our in-house technology to streamline and accelerate the underwriting process.”
Bank of England governor Mark Carney expressed concerns over the UK’s buy-to-let mortgage space in December last year, just weeks after the announcement of the SDLT increase for purchases of additional residential properties. But LendInvest has never appeared especially concerned by the government’s attempts to professionalise the buy-to-let sector, perhaps because it is “professional” landlords that the platform is designed to cater to. Co-Founder Ian Thomas told us in November that the most professional landlords should be able to mitigate some of the impact of increased SDLT through careful planning and by thinking long-term about their rental portfolios. That may well be true, but the impact of the tax hike will nonetheless represent an intriguing test for the UK's real estate platforms.