Its stress rate for a two-year fixed or discounted product is now two per cent above the pay rate, while five-year fixed rates are stressed at the pay rate.
For example, the pay rate of its two-year discount product is 5.09 per cent while the stress rate is 7.09 per cent. The two-year fixed product has a rate of 5.59 per cent and the stress rate is 7.59 per cent.
Meanwhile, the five-year fix has a pay rate and stress rate of 5.44 per cent, while the five-year fixed product for expat borrowers has a pay rate and stress rate of 6.09 per cent.
The gross rental income must be at least 140 per cent of the required mortgage payment when calculated at stress rate.
The terms apply to all mortgages including purchase, remortgage or further advance, and a minimum income of £25,000 will be considered.
The Cambridge previously applied a pay rate plus stress rate of 1.5 per cent, using an interest coverage ratio (ICR) to five-year terms, while for two-year options, a stress rate of 8.5 per cent was applied and an ICR of 140 per cent.
Kathy Bowes (pictured), intermediary manager at The Cambridge Building Society, said: “We hope that these changes to our buy-to-let stress rates will provide our intermediaries with more choice for their clients and support those landlords looking to refinance or purchase a buy-to-let property.”
