RBS Stress Test for BTL?

HomeOwner5

Hi All

Mortgage lenders have a stress test they place on BTL properties, i.e. like 6% interest and 150% rent from the monthly mortgage payment.

I am applying for an RBS mortgage, does anyone know what stress test RBS apply here?

Thrugelmir

Lenders under moving towards 145% under regulatory guidance. Recommendation for residential mortgages is 7% interest rates.

So you won't be far away with the figures you are using.

HomeOwner5

Ok thanks. For my calculations, I will use 145% and 6% (the highest i've seen from BTL lenders).

ExpertAdvice

Natwest uses 125% at 5.5% so RBS must be the same.

Daniel_Sparkes

That's correct, Natwest apply the current stress test of 125% at 5.5%.

This is typically the average with most BTL lenders at present, although dependent on certain factors such as length of initial benefit period and loan to value, there are some lenders that relax this slightly and apply an interest rate of 5%.