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TSB reduces high LTV rates and Accord amends affordability calculations

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  • 09/03/2021
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TSB reduces high LTV rates and Accord amends affordability calculations
TSB has cut the rates on its two-year fixed mortgages at 80 to 90 per cent loan to value (LTV) by 10 basis points.

 

Effective from today, the 80 to 85 per cent LTV mortgage for first-time buyers and home movers, with a fee of £995, has a rate of 2.49 per cent. 

At 85 to 90 per cent LTV, the fee-paying product has a rate of 3.24 per cent, while the fee-free option is set at 3.59 per cent. 

 

Accord updates ICR for BTL borrowers

Accord Mortgages has made changes to the interest coverage ratio (ICR) used to assess the affordability of borrowers with outstanding mortgages on buy-to-let (BTL) properties who want to finance their own home.  

From Wednesday, a customer’s BTL portfolio can be classed as self-financing meaning it will not be included in the affordability assessment, if rental income meets a minimum of 145 per cent of the mortgage payments at a stressed rate of 4.5 per cent 

This is a change from the current ICR of 135 per cent with a stress rate of five per cent.  

If the ICR is not met, the shortfall will be used in the affordability assessment.   

This change applies to both new and existing customers with background BTLs who need additional borrowing or want to make changes to their mortgage where an affordability calculation is required.  

Nicola Alvarez (pictured), corporate account manager at Accord Mortgages, said: “We’re confident this change to the ICR will help more landlords finance their residential property without the need to include their BTL portfolios in affordability assessments.” 

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