BTL Stress test affordability

Dunmore

I have spent a good while researching this but cannot get a definitive answer.

I want to remortage a currently let BTL property for £195k.

Current property value is 260k and rental income is £850pm

I fail the 5% affordability stress test at 125% of rental income by quite a bit. Are there lenders who will consider both rental and salaried income or is it always one or the other?

thanks in advance.

Thrugelmir

This week there's a new statement of practice by lenders ( not regulatory guidance). Though in 2016 some BTL lending will fall under the jurisdication of the FCA.

Lenders will set internally their own policy with regards to:

"Responsible lending (how affordability is assessed, taking into account the rental income from the property and prudently allowing – by stress-testing – for rental voids or increases in mortgage interest rates)"

So you may find it more difficult than in the past.

amnblog

Yes there are

Dunmore

Thank you both for your replies. I am now looking at the second charge loan route also. Does anyone know if Chelsea permit this on their buy to lets. I rang them and they couldn't answer my question
and told me someone would call on Monday. I believe some lenders do, some don't.

Does anyone know The Chelsea's policy?