Newcastle raises rental calculation to 145%

Newcastle Intermediaries has increased its buy to let rental coverage ratio from 125% on a reference rate of 5% to 145% on a reference rate of 5.5%.

Related topics:  Mortgages
Rozi Jones
24th May 2016
Newcastle Building Society
"As a responsible lender we are keen to ensure that customers are well positioned to deal with these changes in advance."

The maximum number of investment buy to let properties that Newcastle Intermediaries will lend on mortgaged properties has also been reduced from five to three.

Newcastle said the changes reflect the forthcoming changes to tax relief that will affect individual buy to let investors from 1st April 2017 and also "the requirement to ensure that all costs associated with a rental property are fully accounted for".

Head of mortgage distribution, Steve Carruthers stated:

“As a responsible lender we are keen to ensure that customers are well positioned to deal with these changes in advance.”

Last week, Barclays and Foundation Home Loans both announced an increase in rental calculation for individual applications from 125% to 145%.

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