TSB toughens unsecured debt criteria for mortgage borrowers

TSB toughens unsecured debt criteria for mortgage borrowers

 

The lender will no longer accept applications from those who have opened three or more financial products, such as credit cards or personal loans in the last six months.

Borrowers will also be turned down if their unsecured balances have increased by more than 20 per cent in the last three months, and the monthly commitments are more than 20 per cent of gross monthly income or where the total debt balance is more than 100 per cent of gross annual income.

Applicants will also be declined if they have been one month or more late with a mortgage payment greater than £100 in the last 12 months.

On buy to let, TSB is also restricting applicants to borrowing a maximum of 20 per cent of the property’s value in order to pay off unsecured debt through additional borrowing.

The stress interest rate for like-for-like remortgages where the borrower has only one mortgaged property has also been lowered to 4.60 per cent.

It comes after the lender recently tightened its criteria around furloughed borrowers.