BM Solutions has announced the launch of top slicing for buy-to-let (BTL) applications.

Top slicing enables customers who have a shortfall in their required lending to use a proportion of their earned income when the rental income for the BTL property is not sufficient to hit standard rental cover ratio (RCR) calculation.

The top slicing comes with qualifying criteria.

It is not available for portfolio landlords or let to buy customers

There must have a minimum income of £100,000 per application ( for the first two applicants)

Customers will be minimum stressed at 125% RCR – below this, the standard RCR calculation will be offered.

They will be maximum stressed at 145% RCR and for anything over this, the standard RCR calculation will be offered.

A full affordability assessment will be carried out as part of an application to ensure that it meets minimum top slicing requirements and customers have enough disposable income to cover any rental shortfall required for any requested loan.

If an application doesn’t meet the requirements, BM Solutions says the standard rental cover ratio calculation will apply and the max loan available will be offered.

If an application meets the requirements and the customers have available disposable income an increased loan maybe offered up to the maximum RCR amount.

This amount could be lower than the requested loan but higher than the standard RCR assessment amount.