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TODAY'S OTHER NEWS

Now Newcastle tightens buy-to-let criteria

Newcastle Intermediaries has become the latest lender to announce it is raising its stress test levels for buy-to-let mortgages.

It is increasing its buy-to-let rental coverage ratio from 125% to 145%, and its reference rate from 5% to 5.5%. 

This follows other lenders such as The Mortgage Works, which recently raised its stress test level from 125% to 145%.

Newcastle has also reduced the maximum number of investment buy-to-let properties that it will lend on from five to three.

This doesn’t include mortgage-free buy-to-let properties.

Newcastle said the changes reflect the forthcoming changes to tax relief that will affect individual buy-to-let investors from 1 April 2017.

Head of mortgage distribution Steve Carruthers said: “As a responsible lender we are keen to ensure that customers are well positioned to deal with these changes in advance.”

Brokers have until 31 May to submit any applications previously agreed prior to this date under the old policy. 

Any buy-to-let applications currently being processed will continue to be assessed under the old policy.

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