Barclays is to increase its affordability stress test rate for residential mortgages to 6.99% from next week.
The lender will increase the rate from the current level of 6.73% on Tuesday 19 August.
Barclays said the move was as a result of the Financial Policy Committee’s new guidelines on affordability.
Under new rules lenders must consider how a 3% increase in Base Rate would affect a borrower’s ability to repay the mortgage.
The stress test rate applied to Help to Buy mortgage guarantee and Family Springboard cases will remain at its current level of 7.24%.
Earlier this year the bank made changes to its buy-to-let stress testing. Previously the lender tested buy-to-let applicants against 125% of pay rate but changed this to 125% of the 5.79% nominal rate in May.
