We’re making various changes to our residential and Buy to Let criteria on Wednesday 9 February.
We’re updating our residential affordability rates to reflect December’s Bank of England base rate increase.
We’re also updating our Buy to Let rental cover thresholds (ICRs) to allow us to better consider your client’s tax position:
| At least one applicant’s income tax band is 20% or less | Will decrease to 125% (was 130%) |
| All applicants’ income tax bands are higher than 20% | Will increase to 150% (was 145%) |
Our affordability and Buy to Let calculators will be updated to reflect these changes. So please use these calculators to make sure you get an accurate reflection of what we can lend your clients.
At the same time, we’re simplifying rules for Buy to Let owner occupiers. So now at least one applicant must still own a residential property (which will be checked with Land Registry), but they don’t need to be living in it.
There is a new decline rule for Buy to Let applications where applicants are looking to buy a property that they’re currently renting.
Pipeline rules
Our usual pipeline rules will apply. All full mortgage applications (FMAs) already submitted on Introducer Internet by close of business on Tuesday 8 February won’t be affected by these changes. Any FMAs submitted from 6am on Wednesday 9 February, or where a material change is made to an FMA submitted before close of business on Tuesday 8 February, will be assessed using our updated lending policy.
