Accord Mortgages is reducing the interest cover ratio (ICR) rates it applies to buy-to-let affordability calculations.

The intermediary-only lender is reducing the ICR rate for landlords remortgaging on a like-for-like basis on products with a term of five years or more from 6% to 5.5%, or product rate plus 1%, whichever is higher.

For landlords who are purchasing a property, or remortgaging with capital raising, the ICR rate is now 5.5%, down from 6.5%, or product rate plus 2%, whichever is higher, on deals with terms of five years or less.

For product terms of five years or more, the ICR rate will reduce to 4.75% (was 5.5%) or product rate plus 1% (whichever is higher).

The broker arm of Yorkshire Building Society’s interest coverage ratio (ICR) will remain at 125% for all basic rate taxpayers and 145% for all higher rate taxpayers.

Accord Mortgages senior manager for new propositions Nicola Alvarez says: “Things have been extremely challenging for landlords in recent times, so, as a buy-to-let lender, we’re constantly reviewing our offering to find new ways to help them as much as we possibly can.

“The private rental sector is crucial to the functioning of our economy, therefore it’s so important that we, as an industry, continue to look for opportunities to support landlords. We hope this change will come as welcome news.”