Brokers caught out by hidden Clydesdale BTL tweaks

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Brokers report buy-to-let customers are being caught out by Clydesdale changing its stress tests without telling them beforehand. 

Clydesdale sent brokers an email on 13 October saying all buy-to-let applications had an extra 3 per cent stress on the balance of customers’ background mortgages. 

This increase in borrower’s monthly payments is factored into the lender’s affordability checks. 

However, the lender had actually brought in these changes 15 days earlier. 

As a result, one broker tells Mortgage Strategy he submitted a case to Clydesdale on 9 October without knowing this.  

The case was passed to the lender for offer at the end of last week.  

However, Clydesdale then said the client would have a shortfall of £50,000 as a result of the new changes, meaning he could not buy his property. 

A Clydesdale spokeswoman says the lender is “in dialogue with this broker and are working with them to try and help find a solution”.  

Mortgage Strategy understands there are other brokers in a similar position. 

Clydesdale says: “Following a number of broker queries we decided to provide further information on changes made to the background stress testing of mortgages.

“This detailed area of affordability calculation is not an area we would normally disclose, however we wanted to assist brokers in order to ensure that our changes were clear.” 

The lender says most of its brokers now understand the changes and their impact. 

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