Below is an update from Tandem Home Loans. Contact our team today for more information.
Announcement
Important Tandem Home Loans Changes
Good afternoon, we trust this finds you well.
We would like to keep you up to speed with some changes here at Tandem Bank.
We are pleased to announce some positive changes to our affordability criteria.
Revised I&E Calculator
We have reduced our stress test following the Bank of England rate reduction. The attached I&E – Tandem HL V2.3 is available for immediate use and can be used on existing pipeline cases.
Criteria Change – Background BTL Properties
BTL properties are assessed on an Interest Rate Cover Ratio (ICR%) basis – we have removed the application of the stress test to this.
ICR% = (Gross monthly rental income ÷ BTL mortgage payment) x 100
For other mortgages in the background:
Where the applicant(s) own additional properties on a Buy-to-Let (BTL) basis, we only require evidence of rental income via last 3 months filtered bank statements or copy of AST, and proof of the BTL mortgage payments. We no longer require the land registry search on the other properties in the background, however the address(s) must be included in the credit search.
We have included an ICR calculator on the I&E excel to assist you in the calculation.
Lending behind Fleet Mortgages
We can no longer sit behind Fleet Mortgages with immediate effect.
Lender Base Rate (LBR) Change – Reminder
Tandem Home Loans will be increasing the Lender Base Rate (LBR) to 4.5% with effect from 1st September 2024. Please ensure all customers are aware of the upcoming change.
How will this affect our pipeline?
Offers issued up to 31st August. If your customer has already received a Mortgage Offer from us, then you need do nothing. When the customers fixed term period is due to end, we notify customers of the Lender Base rate applicable at that time.
Offers Issued after 31st August. If you have produced a Mortgage Illustration (ESIS) on our system prior to 1st September that is still within its 30-day validity date and proceed to submit the case for underwriting, we will issue the Binding Mortgage Offer (BMO) reflecting the new LBR with a rate change offer cover letter which notifies the customer of the increase in base rate. This also applies to pipeline cases already submitted to the office.
We kindly ask that you thoroughly read through this email and cascade it to all relevant team members. Please see attached the following updated documents:
- Tandem I&E V2.3
Please replace all previous versions.
We would like to thank you for your continued support and trust the positive changes will deliver additional opportunity to you and your clients. If you need any further information, please don’t hesitate to get in touch.