PRA threatens big banks to rein in buy-to-let
Big banks have been threatened to rein in buy-to-let by the Prudential Regulation Authority in person in the past two weeks, the Financial Times has reported.
Three separate banks reported the PRA visiting to express concerns about the buy-to-let market, with the message being “we think you have enough buy-to-let loans”.
While the PRA did not explicitly tell banks not to extend buy-to-let loans this was apparently implied.
Christian Faes, chief executive of LendInvest, said: “The government is trying very hard to kill the buy-to-let market.”
The PRA is stress testing buy-to-let loans from 1 January 2017 to a minimum of 5.5% for the first five years of the mortgage.