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TSB stops accepting furlough income and increases some mortgage rates

Christina Hoghton
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Christina Hoghton

Lenders are revisiting their criteria as the financial impact of the Covid-19 pandemic unfolds

TSB has confirmed it will no longer be accepting furloughed income for mortgage applicants.

The lender told mortgage advisers today that it will be making the change from 28th August and joins NatWest and several other lenders in preparing for the end of the government’s furlough scheme.

Joint applications from furloughed borrowers will be accepted with a nominal amount being submitted on to the application and affordability calculated on the single income.

This will apply even if the borrower is having their furlough pay topped up by the employer.

For those who have returned to work part-time, only this income will be eligible for consideration.

A TSB spokesman told Your Mortgage’s sister title, Mortgage Solutions: “These are temporary measures that will help to ensure the mortgages we provide are affordable for our customers.”

Higher rates

In a further move, TSB is increasing rates by up to 0.55 per cent on a number of high loan-to-value (LTV) products from tomorrow – with expiring deals being removed tonight.

Changes will be made on residential purchase products at 80 per cent LTV and on remortgage deals at 85 and 75 per cent LTV.

Shared equity deals are also being affected with all two-year fixes being removed and a range of five-year products being replaced.