Tiered ICR for buy to let mortgages introduced by Coventry.

Buy to let mortgages are widely available from lenders throughout the UK, however there are some lenders who offer their product ranges via intermediaries only. These ranges can often work out to be more flexible for landlords, which is why it can be very worthwhile consulting with Deal Direct.

Coventry for Intermediaries, for example, is one of these lenders.

Their range of buy to let mortgages previously had an interest cover ratio (ICR) of 140%, however, it has recently changed its criteria and introduced a tiered ICR system.

If your total gross income amounts to less than £40,000 per annum and you either don’t pay tax or pay tax at the basic rate, the ICR would be 125%.

If your income amounts to more than £40,000 p.a. or you pay tax at the higher rate, the ICR would be 140%. All applications will continue to be stress-tested at 5.5% or 5% for a 5 year fixed term product, or longer.

Coventry previously stipulated that landlords should demonstrate at least 12 months’ continuous employment. This criterion is no longer a requirement.

Deal Direct are regulated to offer independent mortgage advice; however, we are not regulated to offer general financial advice. If you want to discuss the suitability of property as an investment, you will need to contact an independent financial adviser.

Please note that buy to let mortgage applications from:

• applicants whose intention is to benefit from house price growth
• applicants whose intention is to benefit from rental income
• applicants who are letting to buy

will be treated as normal buy to let and not as a consumer buy to let. In addition, their subsequent remortgage applications will also be treated in the same manner.

Discuss your buy to let mortgage on 0800 048 8828 today.