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BTL Affordability Boosted by Landbay for Remortgages

Ideal for landlords looking to remortgage with no changes to their current borrowing

Landbay has reduced the affordability stress tests for like-for-like remortgages on its buy-to-let (BTL) mortgages.

Instead of using the standard pay rate plus 2%, the stress test is based simply on the pay rate, aligning the 2-Year Fixed Rate Mortgage with Stress Tests on 5-Year Fixed Rate Mortgages.

This is ideal for landlords looking to remortgage with no changes to their current borrowing requirements and who are seeking a shorter-term product where meeting affordability criteria may have presented issues.

If we look at a standard individual basic rate taxpayer, getting a 75% LTV 2-Year Fix at 5.89%

  • Before, a rent of £1,000 would have got you a mortgage of £121,673
  • Now, a rent of £1,000 will get you a remortgage of £162,988

An extra £41,000 for like-for-like remortgages.

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In Comparison

LandBay's update aligns remortgage like-for-like stress tests with other Buy-to-Let (BTL) Mortgage Lenders such as The Mortgage Works. Both lenders now offer similar like-for-like stress tests. However, TMW provides lower rates and offers a comparable product at 4.24% but has a minimum stress rate at 4.5%. This means that landlords receiving £1,000 rent can borrow up to £213,333.

In comparison to other mortgage lenders:

  • £213,333 from The Mortgage Works (Min 4.5% or PayRate = 4.5%)
  • £174,545 from BM Solutions (Min 5.5% or PayRate + 0.50% = 5.5%)
  • £162,988 from Landbay
  • £150,234 Accord Mortgages (Min 6.0% or PayRate + 1.00% = 6.39%)
  • £135,401 Fleet Mortgages (PayRate + 2.00% = 7.09%)
  • £133,518 Precise Mortgages (Min 5.5% or PayRate + 1.55% = 7.19%)

Based on today's mortgage rates (13/05/2024), the examples shown may not be accurate if you are reading this even a day later.

How to do the Maths?

#The Formula:
Rent (times) 12 (divide) ICR Rate (divide) Stress Rate

#Before, it was:
£1000 (times) 12 (divide) 125% (divide) 7.89%

#But now it is:
£1000 (times) 12 (divide) 125% (divide) 5.89%



What is PayRate? In this context its the mortgage rate charged in the initial 2-Year Fixed period of the mortgage.

What is Interest Cover Ratio (ICR)? When considering Basic Rate Taxpayers, most lenders typically require rental income to cover 125% of the interest charged on the loan. This means that the rental income must cover all of the rent plus an additional 25%.

What is Like-for-Like Remortgage? This is when you remortgage with no additional borrowing. You get the same mortgage amount you currently have but with a new mortgage lender.

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New Lane, Bradford, BD4 8BX

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We are authorised and regulated by the Financial Conduct Authority (No. 919921). The FCA does not regulate most Buy to Let mortgages.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

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Cyborg Finance Limited is registered in England and Wales (No. 12131863) at Bradford Chamber, New Lane, Bradford, BD4 8BX

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