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BM Solutions cuts BTL stress rate on five-year fixes

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  • 13/03/2017
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BM Solutions cuts BTL stress rate on five-year fixes
BM Solutions has introduced a lower stress rate for purchase and remortgage buy-to-let applications.

From 20 March, BM Solutions will offer five-year fixed products with a stress rate of 5.25%, instead of its standard 5.5% rate.

BM Solutions head Phil Rickards (pictured) said: “The new stress rate forms part of our wider phased plans to support brokers in writing quality business in the new regulatory landscape.

“We created the rental income calculator in November to help higher and top rate taxpayers get the right level of cover for their individual circumstances, and then moved stress rates at the end of 2016.

“We are continuing to invest in our service and commitment to the intermediary market and plans for the next phase are underway.”

Applications submitted prior to 20 March will continue with the stress rate on which the application was submitted at Decision in Principle stage.

In-progress applications must be resubmitted in order to be eligible for the new stress rate

The new stress rate will not apply to further advances and porting applications.

If a customer selects a five-year fixed product for these applications, the standard stress rate of 5.5% will apply where available.

BM Solutions launched an intelligent rental income calculator in November 2016, designed to support brokers through the tax changes by helping them obtain a rental coverage ratio (RCR) relative to higher and top rate taxpayers’ individual circumstances, while keeping RCR at 125% for basic rate taxpayers.

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