Portfolio Landlord Stress Test Navigation for a Midlands Investor
£2,100,000 · 25 years · 5.55% fixed 5 yrs. A Midlands portfolio landlord with eleven properties had been declined by two lenders on the basis that the PRA portfolio landlord stress test - applied to the whole portfoli...
The Client
Midlands portfolio landlord
The Challenge
A Midlands portfolio landlord with eleven properties had been declined by two lenders on the basis that the PRA portfolio landlord stress test - applied to the whole portfolio rather than each individual property - showed the portfolio as under-stressed when all existing mortgages were included in the calculation. His individual properties were all profitable.
Our Solution
Doulton's portfolio landlord specialists conducted a full PRA stress test analysis across all eleven properties. Properties with excess coverage were identified and their surplus used to offset properties with thinner coverage. A lender with a portfolio-level rather than property-level stress test methodology was selected, resolving the issue that had caused the previous declines.
The Outcome
Mortgage placed successfully. The client had not realised that different lenders apply the PRA stress test differently - Doulton's knowledge of each lender's methodology was the key to a successful outcome where two previous attempts had failed. Key highlights: PRA stress test applied at portfolio level - resolved previous declines; Lender methodology differences navigated by Doulton specialists; 11-property portfolio placed successfully after two prior declines.