Buy-to-let lender continues to batter down its arrears levels

Specialist lender CHL Mortgages has revealed that 2010 ended with further improvements to its arrears levels across its buy-to-let mortgage book.

Figures for quarter four of 2010 show that only 2.03% of all CHL’s buy-to-let mortgage accounts were over three months in arrears.  This compares with industry figures released this month by the Council of Mortgage Lenders which show a comparable figure of 2.62%.

As at the end of 2010, CHL’s gross arrears levels are now 42% down since their peak in February 2009. 

CHL, part of the Irish Life & Permanent Group and based in Fleet, Hampshire, said it fully expects the downward trend to continue throughout 2011.

There has also been a continuation in the overall improvement in accounts where a receiver of rent has been appointed. These properties are now achieving, on average, 155% rental cover, and of the total number of properties available to let, 92% are let at this time. This has improved from a figure of 36% 18 months ago.
   
Bob Young, managing director at CHL Mortgages, said: “As our figures show, we are consistently outperforming the wider buy-to-let sector by a significant margin. 

“CHL’s focus is on driving down arrears levels by working with our borrowers, and we fully anticipate that our hard work in this area will produce further improvements throughout 2011. 

“Outperforming the industry is one thing. However, we should also remember that CHL’s figures are based on a static mortgage book, meaning there is no new lending to make our arrears level look even better.”

While CHL, which also pioneered self-certification mortgage products, is not originating new loans as it concentrates on managing its existing business, it did take on an additional £295m buy-to-let portfolio in December, passed to it by its parent company.