LendInvest completes £300m buy-to-let securitisation

LendInvest has completed a £300m securitisation of UK buy-to-let mortgages, the eighth transaction under its Mortimer programme since 2019. The deal, called Mortimer 2026-1, was announced on 25 September 2026 and is the first Mortimer transaction to carry a UK Simple, Transparent and Standardised (STS) designation. It matters to UK landlords with buy-to-let mortgages from LendInvest BTL Limited, to institutional investors who buy mortgage-backed notes, and to a specialist lender for which capital-markets transactions like this one form part of a funding mix that also includes institutional partnerships and bank facilities.

Securitisation is a way of turning a pool of mortgages into tradeable notes bought by investors. LendInvest packages mortgages it has already lent and sells notes backed by the cash flows those mortgages produce. LendInvest says the structure is designed to recycle capital that can support further lending, though the amount and timing of any additional lending were not disclosed. The mortgages themselves are not cancelled or repaid early: borrowers' obligations continue, and LendInvest BTL Limited remains the servicer of the initial pool. Whether any borrower's payment instructions or other transaction-specific arrangements changed at closing was not established from the sources reviewed.

What was securitised

The £300m headline figure is not the value of a single block of mortgages. It comprises £265m of loans already in the pool at closing, plus £35m of pre-funding: capacity to add further eligible mortgages to the structure after completion. LendInvest says the initial portfolio contains 1,240 mortgages, all originated and serviced by LendInvest BTL Limited, and that every one of them was performing at the pool's cut-off date, though the announcement did not define what "performing" meant for this transaction.

LendInvest did not disclose that cut-off date in its announcement, so readers cannot tell precisely when this snapshot of pool performance was taken. The company also reported a weighted average current loan-to-value ratio of 73.23% and weighted average rental cover of 177.25% for the initial pool, again as of the undisclosed cut-off date. LendInvest did not explain how rental cover was calculated, including whether it uses current, stressed or underwritten rent and interest figures, so the ratio should be read as a company-supplied summary rather than a fully defined metric.

Separately, the seven note classes admitted to the FCA's Official List on 25 September 2026 have a combined face value of £311.7m — larger than the £300m figure LendInvest uses to describe the transaction. That gap is not necessarily an error. The £300m figure reflects the initial mortgage pool plus pre-funding capacity, while the £311.7m total includes the full note structure, including two additional classes, X1 and X2. The transaction's prospectus, dated 22 September 2026 according to Prime Collateralised Securities (PCS), would be needed to reconcile the two figures precisely.

Investor demand and the price of funding

LendInvest reported strong demand for Classes A, B and C, the note classes for which it disclosed order-book coverage. According to the company, orders reached 2.5 times the size of the Class A notes, 3.8 times Class B and 4.4 times Class C. These are company-reported order-book figures rather than independently audited allocations, and the available sources do not disclose the final number of investors, their identities, or how much of the demand came from investors new to LendInvest.

Source: Prime Collateralised Securities and the FCA Official List notice, 25 September 2026. PCS records ratings for the subordinated classes; the underlying Fitch and Morningstar DBRS rating reports were not located in the reviewed sources.

The £270m Class A notes priced at 82 basis points over SONIA (the Sterling Overnight Index Average, the Bank of England's benchmark rate). That is one basis point wider than Mortimer 2025-1's Class A spread of 81 basis points over SONIA. Despite that, LendInvest reported the transaction's overall weighted average funding cost at 88 basis points, four basis points lower than Mortimer 2025-1's 92 basis points. The two figures are not measuring the same thing: the senior spread reflects pricing on the largest, safest tranche alone, while the weighted average cost blends pricing across the whole capital structure. A narrower senior spread is not the same as a lower average cost, and this transaction shows the two can move in opposite directions.

LendInvest's first UK STS designation

Mortimer 2026-1 is the first Mortimer transaction reported as UK STS. PCS records it as UK STS transaction UKSTSTERM-00383, with an STS notification and verification checklist dated 24 September 2026.

STS is a designation under the UK's current securitisation framework, which is established by the Securitisation Regulations 2024 and related FCA rules; the relevant provisions came fully into force on 1 November 2024. The Financial Conduct Authority (FCA) says the STS regime is intended to help investors understand and assess securitisation risk, and that qualifying STS positions can receive preferential regulatory capital treatment under applicable requirements. Under the FCA's rules, qualifying non-asset-backed commercial paper securitisations need an FCA notification, inclusion on the FCA's published STS list, a UK-established originator and sponsor, and satisfaction of detailed criteria set out in the FCA Handbook.

LendInvest suggests the designation may widen the pool of investors willing to buy the notes, including bank treasury investors that benefit from the capital treatment STS status can unlock. That is a stated potential effect rather than a demonstrated outcome: the reviewed sources do not show how many, if any, additional investors participated in Mortimer 2026-1 specifically because of its STS status.

It is worth being precise about what STS does not mean. It is a regulatory classification describing how the transaction is structured and disclosed, not a rating, an endorsement of credit quality, or a guarantee that the notes or the underlying mortgages are risk-free. Ratings agencies, not the STS framework, assess the likelihood of noteholders being repaid, and even AAA-rated notes carry some risk of loss.

How the deal recycles capital

LendInvest says the transaction lets it recycle capital and support further mortgage originations, alongside its other funding sources, which include institutional partnerships, bank facilities and further capital-markets issuance. In broad terms, this is how the mechanism works: mortgages that LendInvest BTL Limited has already lent are transferred into a structure in which Mortimer 2026-1 PLC, the issuer vehicle, sells notes to investors backed by the cash flows those mortgages produce. Investors provide funding in exchange for interest paid on the notes and take on exposure to the pool's cash flows and credit performance; the transaction is intended to free up capital that LendInvest can use to support new lending. The precise legal allocation of ownership, cash flows and other responsibilities between LendInvest and the issuer vehicle would require the final prospectus, which was not reviewed for this article.

The amount of new lending capacity LendInvest has actually gained from this transaction, and the timeframe over which it expects to deploy it, were not disclosed in the sources reviewed.

What does not change for borrowers

Securitisation reallocates who is exposed to a pool of mortgage cash flows and credit losses. It does not extinguish the underlying mortgages, and it does not remove risk from the system — it moves that risk to noteholders and any retained interests, according to the structure of the notes.

For the 1,240 landlords whose mortgages sit in the initial pool, the obligations attached to their loans do not disappear. They remain responsible for making their mortgage payments on the agreed terms, and missed payments can still lead to enforcement action under those terms, including arrears processes and, ultimately, repossession where a lender pursues that route. LendInvest's announcement states that LendInvest BTL Limited continues to service the mortgages in the initial pool, which means securitisation does not, on the basis of what has been disclosed, necessarily change who borrowers deal with day to day for payments and account queries. The precise legal allocation of servicing, enforcement and borrower-notification responsibilities under this specific transaction would require the final prospectus and transaction documents, which were not reviewed for this article.

Programme context

Mortimer 2026-1 is LendInvest's eighth securitisation under the Mortimer programme, which the company says began in 2019. Mortimer 2026-1 PLC, the issuer vehicle, was incorporated in England and Wales on 30 June 2026 under company number 17310086, according to Companies House. The seven listed note classes were admitted to the FCA's Official List on 25 September 2026, each with a legal final maturity of 22 September 2071 — a long-stop date for repayment, not a forecast of how long the underlying mortgages are expected to remain outstanding.

What to watch next

Several details remain undisclosed and worth tracking as more documentation becomes available: how and when LendInvest deploys the £35m of pre-funding into additional mortgages, whether the company reports fresh originations attributable to this transaction, how the initial pool performs over time, and whether further detail on investor allocations or the transaction prospectus clarifies the £300m-versus-£311.7m distinction. Readers wanting the primary detail behind this transaction can consult the FCA's Official List notice, the PCS verified-transactions record for UKSTSTERM-00383, and LendInvest's own announcement, rather than relying on secondary commentary.