Santander has changed its residential and buy-to-let criteria around second income and affordability rates to improve affordability.
The changes come into force from today.
On the residential side, a maximum of 70 per cent secondary income can be used in affordability calculations. This is up from 65 per cent previously.
The firm said that secondary income, whilst it was “not permanent or guaranteed” is still “regular and sustainable”.
The affordability calculator will automatically work out how much income a customer can use and calculate a net monthly income figure.
The lender added that residential affordability rates have been increased following the base rate increases in February and March.
The affordability calculator will also be updated to account for the 2023/2024 tax year changes and household expenditure figures.
Buy-to-let changes
On the buy-to-let side, its buy-to-let affordability rates have been reduced, with its standard affordability rate decreasing to 7.59 per cent from 8.25 per cent.
Its five-year fixed affordability rate will decrease to 6.09 per cent from 7.25 per cent.
Its pound-for-pound remortgage affordability rate has gone down to 6.09 per cent from 7.75 per cent.
Full mortgage applications (FMAs) submitted by 10pm on 18 April won’t be impacted by these changes.
FMAs submitted by 6am 19 April will be underwritten by its new lending policy.
Anna is currently the deputy editor for Mortgage Solutions and editor for Specialist Lending Solutions. She has worked as a journalist since 2019, having secured her Gold Standard NCTJ diploma from News Associates in a fast-track six-month course.
She started her career as a report at specialist publication The Insurance Insider covering a wide range of areas before joining Mortgage Solutions and Specialist Lending Solutions in 2021.
In her role, she helps put together and structure the news agenda for the day and writes up press releases, reports, interviews, analyses and exclusives across both titles. She also commissions blogs for Specialist Lending Solutions and hosts online masterclasses and in-person events across the business.
She has been shortlisted for three journalism awards, which include BIBA Journalist and Media Awards Scoop of Year Award in 2020, Headline Money Mortgage Journalist of the Year Award (B2B) in 2022 and 2023.
Prior to being a journalist, Anna worked in ecommerce across Snow + Rock, Cycle Surgery and Runners Need websites, and before that worked at specialist financial PR firm Rostrum.
In her spare time, Anna enjoys reading, seeing live music, and cooking for friends and family. When she gets a chance, she also enjoys hiking, skiing and indoor rock climbing.
