West Brom changes to notional B2L rent calculations

West Brom for Intermediaries is switching its buy-to-let rental calculations to a fixed notional rate of 5.95%.

This is based on 100% interest-only cover, and comes into effect from March 1.

The societys rental calculation is currently based on 100% interest only cover at Bank base rate plus 1%.

The new calculation is based on a fixed notional rate of 5.95%, so if rates rise again, the rental calculation will remain unaffected.

Paul Marland, area general manager of intermediary sales at West Brom for Intermediaries, says: Brokers have found it increasingly difficult to place buy-to-let applications in a market where interest rates have been on the increase.

“A further rate rise will make life even tougher and many borrowers are being forced to top-up the rental using their earned income.

The societys view is that 5.95% will result in a rental calculation similar to our current calculation of base rate plus 1%.

“Our fixed notional rate of 5.95% will make life a lot easier and provide brokers and borrowers with certainty in a market where there is considerable conjecture that were in for another rate rise.