NatWest tightens its buy-to-let rental calculation for landlords
NatWest has tightened its buy-to-let rental calculation making it tougher for landlords to secure a sufficient mortgage.
In order to work out how much money a bank or building society will lend for a buy-to-let mortgage, they will want to know how much rental income the property generates. They can then apply their rental calculation to generate a maximum mortgage loan.
As a result of NatWest’s rental calculation changing from 125% x 5.25% to 125% x 5.5%, a property generating £1,750 rental income each month previously allowed a landlord to secure a £320,000 mortgage, although this has been reduced to £305,454.
Aaron Strutt, product manager at Trinity Financial, says: “NatWest has got some particularly impressive buy-to-let mortgage rates at the moment but landlords will need a larger deposit to qualify.
“Many of the lenders have tightened their rental calculations over the last few years and it can be tricky to secure a large enough buy-to-let mortgage.
“Some of the banks and building societies are more generous than others so it is worth researching the market if you need to borrow more money.”
In order to qualify for NatWest’s buy-to-let mortgages, clients must have a minimum income of £25,000. Although applicants planning to borrow £1 million or more will need to have a minimum annual income of £50,000.
Click here to use Trinity's buy-to-let rental income calculator
If you would like help to secure a buy-to-let mortgage, call Trinity on 020 7016 0790.
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