Santander is facing the wrath of private tenants after it emerged that there is a clause in its buy-to-let mortgage contracts requiring landlords to raise rents by “as much as can be reasonably achieved” whenever possible.

The wording, which was exposed by Mortgage Strategy yesterday, after the publication was contacted by a private landlord who had spotted the clause in her mortgage contract, has been buried in Santander’s contracts for almost six years.

The landlord said: “The public views landlords as greedy, but how many people are aware that landlords are being forced to increase rents by banks such as Santander?

“The Santander contract states that when rents are up for renewal the landlord must get written advice from a qualified valuer [as to] whether the market rent at the date of the review is likely to be higher than the rent currently payable.”

Ray Boulger, senior technical director at John Charcol, commented: “This doesn’t square very well with the best interests of consumers.”

Lucy Hodge, managing director at Vantage Finance, described Santander’s clause as “excessive and disproportionate”, insisting that she could not see “any sense in it whatsoever”.

However, a spokesman for Santander disagreed with the criticisms of the policy.

He said: “The contract has been in place and remained unchanged since we entered the market in 2011.

“Landlords should set their rents at a prudent level that is fair for the tenant (based on market rates) and that ensures they can continue to service the debt.

“Our interest is that the landlord ensures they can continue servicing the loan.

“Any potential to increase the rent is only that which can be ‘reasonably achieved’. There is plenty of discretion for the landlord to set a rent that they and the tenant agree, and no direct obligation imposed by us that the rent should be the maximum possible.”