Newcastle for Intermediaries has announced a reduction in its residential stress rate for those borrowing over a term of up to five years, improving affordability options for borrowers.
The change applies to the Society’s two, three and five-year fixed rate residential products. By reducing its stress rate the lender has improved the potential amount borrowers can lend across its full product range, including shared ownership and interest-only, unlocking additional borrowing capacity.
Newcastle is the latest of several lenders to enhance affordability by reducing stress rates. Earlier this year, the FCA clarified the rules on stress rates, confirming the option to stress affordability with reference to product rather than revert rates.
Franco Di Pietro, head of intermediary mortgages at Newcastle Building Society, commented: “We are committed to supporting our intermediaries and their clients in navigating the complexities of today’s mortgage landscape. The reduction in our residential stress rate is intended to boost borrowers’ affordability and demonstrates our dedication to making homeownership more achievable.
“Our residential stress rate is just one of the ways we measure affordability as part of our approach to ensuring responsible and sustainable lending, and we believe this move will empower brokers to help more clients secure the funding they need.”
