Platform changes BTL interest cover ratio

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Platform will now assess eligible buy-to-let remortgage applications, without additional borrowing, using a minimum of 128% rental cover at a notional interest rate of 5.50%.

The intermediary-led mortgage brand of The Co-operative Bank says this arrangement supports landlords who already had a mortgage before the new PRA affordability guidelines came into effect in January 2017, and who are looking for a pound for pound remortgage without any additional capital raising.

Buy-to-let mortgage applications that do not meet these criteria will continue to be assessed using a minimum of 145% rental cover at a notional interest rate of 5.50%.

Paul Norcott, head of mortgages and insurance at the Co-operative Bank and Platform, said: “We have been closely following developments in the buy-to-let market since the new PRA guidelines were published, and we know that buy-to-let remortgaging has been more difficult for some landlords since the market adopted those guidelines.

“These changes to our buy-to-let criteria demonstrate that, whilst we remain extremely committed to responsible lending, we also want to take a common sense approach that supports landlords looking for a straightforward like-for-like remortgage.”

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