Accord has tightened its buy-to-let rental cover calculation.
The lender has increased its rental calculation interest rate from 125 per cent at 5 per cent to 125 per cent at 5.24 per cent.
This means landlords must charge more in rent to meet the lender’s requirements or raise a bigger deposit.
For example, on a 75 per cent LTV loan against a £250,000 property, the landlord previously would have had to charge £976 in rent to meet current criteria. However, now they have to charge £1,023 due to the new rate. The changes apply to all new applications irrespective of LTV or loan amount.
Perception Finance managing director David Sheppard says: “When the buy-to-let sector is already facing added difficulties after the Budget, it is a shame to see any lender make this type of lending tougher.
“Let’s hope this is not the catalyst for other lenders to follow suit.”