The Intermediary – September 2025 - Flipbook - Page 46
I N T E RV I E W
Funding aside, one of the biggest challenges
for landlords looking to adhere to future
regulations is the retrofit industry itself. With
2.5 million homes needing upgrades in England
and Wales alone, and a shortage of the skills
and resources to do it, the current proposed
deadlines will be “incredibly difficult.”
The Mortgage Works is engaged with
the Government, lobbying both for longer
timeframes to give landlords time to catch up,
and for more clarity on EPCs themselves. There
are other moving parts, of course, including the
need to boost relevant skills.
Clinton says: “Everything should be joined
up. You can’t set a deadline without a clear
vision of the practical means to get there. It’s
good to have a vision, but it has to be done
in the most practical way that recognises the
demand placed on different parties, including
the landlords themselves.”
In the meantime, he adds: “There’s a lot
of ‘no regrets’ stuff that landlords can do in
advance. There are things we know are going to
help drive the energy efficiency of a property,
and you don’t need to wait for the rules to be
published. But there are other areas where it’s
more nuanced, and people may be inclined to
wait before digging deep in their pockets.”
Leading the way
The Mortgage Works’ approach to helping
landlords navigate an increasingly complex
market is to provide as comprehensive a range
as possible, picking up on trends early. For
example, the lender has served the limited
company sector for nearly eight years, an area
otherwise dominated by specialist lenders,
although now seeing the entrance of other high
street names. Its range also does not just cater
for those with a ‘professionalised’ approach,
but a broad spectrum of potential borrowers.
In order to keep a healthy and diverse cohort
of landlords in the market, Clinton sees the
importance of keeping The Mortgage Works’
customer base as broad as possible, within
sensible risk boundaries.
“Ultimately, our affordability policy is guided
by the underlying economics,” he continues.
“That backdrop has now allowed us the
opportunity recently to reduce our lowest
stress rates down to 4% below 65% loan-tovalue [LTV]. That will support opportunities for
landlords – and their brokers – dealing with
lower yields, such as in areas like London.”
While the range is “very comprehensive,”
some limitations protect the strength of the
lender’s books, such as the assertion that
“rentals must stand on their own two feet,”
44
The Intermediary | September 2025
meaning The Mortgage Works does not offer
top-slicing. It also closely monitors future rent
escalation and pay rate predictions, regularly
revisiting cost assumptions, all of which has
“helped feed through into a really strong credit
performance on our book, where we have some
of the lowest arrears rates in the industry. That
supports confidence in the policy we set.”
In terms of its green proposition – another
area of intense focus for many in the PRS – The
Mortgage Works offers further advance options
at a reduced rate for existing customers looking
to make green improvements to properties,
and has done so for some time. However,
Clinton says at the moment, demand for
these products is low across both BTL and
residential, likely due to ongoing uncertainty
around EPCs and energy efficiency.
Overall, Clinton says, The Mortgage Works
approaches its proposition as a “very much
intermediary-focused brand.”
He explains: “We have a large and expert
sales team with national coverage, and we’ve
been supporting brokers through thick and
thin for the past 25 years, all the way back to
the Credit Crunch when there was a massive
exodus of lenders in the BTL space.
“We’ve been supporting brokers and their
lender clients as a consistent presence, right
the way through various credit cycles.”
Strong foundations
Clinton attributes some of this consistency to
the lender’s access to retail deposits rather
than being reliant on wholesale funding, as well
as its strong foundations as a mutual.
Part of Nationwide’s ethos as a mutual is to
“support all forms of housing tenure,” balancing
all aspects and using its breadth of expertise
to help enact positive and sustainable change.
This means that the BTL arm takes a prominent
role in Nationwide’s overall business strategy,
with the plan being to continue evolving the
proposition in future as new trends, challenges
and borrower needs emerge.
This evolution includes ongoing
enhancements to its Limited Company
proposition, including API integration with
Companies House for a more seamless broker
experience, and expanding its criteria, such
as accepting inter-company loans and nondirector shareholders, and more.
Clinton concludes: “We’ve got more than 30
years of really good experience in the market,
a really good handle on who we lend to, and
doing so responsibly, and that has been a
backbone for us, giving us the confidence to
continue supporting this market.”
