Accord Mortgages has made enhancements to its buy-to-let offering this week.
These changes have been designed to help landlords affected by the current, higher interest rate environment.
The intermediary-only lender has reduced the interest coverage ratio rate (ICRR) – which is the stress rate applied to buy-to-let affordability calculations, to make its products accessible to more landlords, enabling them to continue providing much-needed private rental properties.
Nicola Alvarez (pictured), senior manager for new propositions at Accord Mortgages, said: “As a buy-to-let lender, not just a lender that does buy-to-let, we’re constantly looking for ways to support brokers and their landlord clients.
“We hope these latest positive changes to our criteria will help more landlords to continue servicing the buy-to-let market, providing much sought-after private rented housing.”
In line with these new changes, where landlords are remortgaging on a like-for-like basis, the ICRR will drop to 6.5%, or product rate +1% (whichever is higher).
Additionally, where landlords are capital raising, Accord is reducing the ICRR to 6.5% for products with an initial term of equal to, or greater than five years, or product rate +1% (whichever is higher).
The ICRR also reduces to 7.5% for products with an initial term of less than five years, or product rate +2% (whichever is higher).
The lender is also simplifying the interest coverage ratio (ICR). Moving forwards, the calculation applied will be 125% for all basic rate taxpayers and 145% for all higher rate taxpayers.
The changes apply to all new applications.
