BSA 'disagrees' with buy to let regulations

15 February 2010

Written by David Whittaker

Buy to let mortgage owners could see negative effects if the government was to introduce certain regulations to the sector.

This is the view of the Building Societies Association (BSA), which explained that the Treasury's plans to regulate buy to let mortgages may force lenders to withdraw from the market.

Head of mortgage policy at the BSA Pail Broadhead explained that it is the borrower who decides to enter the buy to let market and, as such, is their own investment choice.

"Subjecting buy to let investors to affordability and suitability assessments in the same way as owner occupiers is not appropriate," he advised.

"Less reputable" organisations may be able to take advantage of a loophole created by such a decision, Mr Broadhead continued.

However, the organisation does support the plans to regulate second-charge mortgages, which would be transferred to the Financial Services Authority (FSA).

Currently the Office of Fair Trading holds responsibility for such mortgages, the FSA notes.

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