The lender said the stress rate change would support landlords’ “wider lending needs”, as they have increased choice and meet remortgage and additional lending requirements.
For instance, a landlord with a rental income of £1,290 wanting to borrow at 80% loan to value (LTV) to remortgage their BTL property can access £184,000, a rise from £165,000 previously.
Another example is a landlord with a rental income of £1,814 per month wanting a 70% LTV remortgage now being able to borrow up to £280,000, compared to £254,000 previously.
HSBC said it was easing affordability constraints for landlords while maintaining responsible lending standards.
The firm added that it was part of a “wider strategic push” to support the BTL sector, having launched top slicing in October and 80% LTV deals in March.
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Oli O’Donoghue, head of mortgages at HSBC UK, said: “I’m pleased that we’ve been able to reduce our BTL affordability stress rates to better support UK landlords. By lowering stress rates, we are helping more landlords enter or remain in the BTL market.
“This supports access to quality rental homes and housing affordability more broadly. Lowering barriers to finance, and easier refinancing options, can help landlords manage costs, supporting greater stability in the rental sector.”
