A P2P (Peer to peer) finance company  proclaims that P2P will turn the BTL mortgage industry into a countrywide phenomenon.

The company independently financed The Wriglesworth consultancy to research the buy-to-let industry and supply a detailed report on its findings. 

The report stated that with an ever expanding population together with the lack of adequate homes build, that the buy-to-let sector could "weather" a new recession and would even survive similar lows of the 2008 recession. 

however not all is good news, as the report did state that the average new rates of mortgages costs landlords a third more with buy-to-let loans than for homeowners.

Apparently P2P mortgage lenders see this trend as their chance to "upset" the BTL mortgage industry to make it more amenable to landlords. The report includes stress tests for the peer to peer lender, which is a published first. It shows that secured peer to peer lending against buy-to-let properties is robust and can withstand any economic plummets. Lending against BTL has considerably less risk than standard financing of unsecured loans to the public, business credit or even development finance.

The P2P company's stress tests of its loan book shows how high the onus should be on quality manual underwriting, when making loans to landlords. Taking time and proper attention to any landlord's personal economics will mean that the loan book stays healthy, rather than opting for an automated underwriting system to approve multitudes of buy-to-let lending. 

John Goodall, cofounder of the P2P finance company said: “The world has changed. Now everyone has access to the sorts of markets that were once the preserve of large financial institutions. A new energy for more inclusive finance, combined with new technology, is revolutionising the world of saving and borrowing. This has only just begun, and over the long-term the impact of these fundamental changes will be far greater than was at first envisioned.

 

“All peer-to-peer finance is relatively new – but it would be an enormous mistake to assume that means this broad swathe of lending is in any way uniform. Combining P2P lending with the backstop of income-producing property as security can create an entirely different class of investment – while shaking up competition in the world of mortgage lending.”