Mortgages  

TSB offers cashback across BTL range

TSB offers cashback across BTL range

TSB has introduced a £250 cashback offer across all its buy-to-let (BTL) products available directly and through TSB Intermediary.

The cashback will be paid to all landlords on completion of the mortgage, and is available on two, three and five-year fixed terms, as well as a two-year tracker.

The bank also made cuts across its BTL range, with landlords who were hoping for a two-year fixed rate now being offered a 0.25 per cent reduction to 2.34 per cent, with a £1,995 product fee.

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Those looking for a five-year fixed rate also get a 0.25 per cent rate cut to 3.14 per cent, with a £1,995 product fee.

Meanwhile, TSB also followed the lead of other lenders by increasing its BTL interest coverage ratio from 125 per cent to 145 per cent.

For deals up to 65 per cent loan-to-value (LTV), it will now charge 145 per cent of five per cent, or the pay rate, whichever is highest. For mortgages up to 75 per cent LTV, it will require 145 per cent of 5.5 per cent or pay rate.

The changes also apply to residential mortgage affordability if the borrower also has a BTL loan.

Adviser view: Lea Karasavvas, managing director at Prolific Mortgage Finance, said it was no surprise to see another lender increasing its stress tests.

He added: “We expect to see more lenders following suit over the coming weeks, given the pressure they are under.

“Perhaps a sensible move right now for those landlords expecting to struggle with enhanced stress tests would be to lock in now, while some lenders are still operating off lower stress tests, or risk having their borrowing potential reduced when more lenders come in line with these increments.”

peter.walker@ft.com