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The Mortgage Works updates stress rate and removes tracker products

  • 25/10/2022
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The Mortgage Works updates stress rate and removes tracker products
Buy-to-let lender The Mortgage Works (TMW) will offer a tailored approach to stress rates based on product term and type, rather than a flat rate.

TMW had updated it stress rate to 8.49 per cent as a flat rate earlier this month as an “interim measure to better protect landlord cashflows during a period of interest rate turbulence”.

Stress rates can vary between 6.64 per cent and 8.79 per cent depending on company structure and term.

For non-limited companies and limited companies with a product term of under five years a pay rate plus two per cent applies.

For non-limited companies with terms of five years or more, a pay rate plus 1.5 per cent is in place, whereas for limited companies this is a pay rate plus 0.5 per cent.

Non-limited companies on tracker and variable rates the stress rate is pay rate plus five per cent, and limited companies have pay rate plus four per cent.


The Mortgage Works removes BTL trackers

The lender added that it would temporarily withdraw its buy-to-let tracker range and lifetime variable products from tomorrow.

Daniel Clinton, head of The Mortgage Works, said: “Earlier this month we adopted an interim measure of applying a flat minimum stress rate for buy to let mortgages to better protect landlord cashflow during the period of interest rate turbulence.

“We have now reviewed our stress rates and we are moving to a more tailored approach based on the product type and term.”

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