CML also against buy-to-let regulation

Further criticism for proposed additional regulation in the buy-to-let market has been offered by the Council of Mortgage Lenders CML.

The organisation has backed the Treasury's plan to extend regulation to cover second-charge mortgages and ensure borrowers are sufficiently protected when mortgage books are sold on, but disagrees with any moves to further restrict the activities of landlords.

CML director-general Michael Coogan claimed the regulatory proposals are "barking up the wrong tree" as far as buy-to-let is concerned, as poor investment advice, rather than the mortgage, is the main problem for amateur property investors.

He stated: "The Treasury recognises that regulation has in the past dampened incentives to invest in the private rental sector.

"The proposals to extend mortgage regulation designed to protect home-owners to the buy to let sector would simply repeat this mistake."

Mr Coogan's comments came after Paul Broadhead, head of mortgage policy at the Building Societies Association, warned that imposing further restrictions on the buy-to-let market could encourage some lenders to withdraw their product ranges.

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2010-02-16 13:31:51 © Moneyextra.com