In the latest change to its interest-only criteria, the bank confirmed it will introduce the raised loan limit across all intermediary brands in the next couple of months as part of its ongoing review of interest only.

Lloyds said it had been able to increase the interest-only loan amount via its branch network owing to the fact that processes are already in place requiring all borrowers to provide evidence of repayment vehicles before an offer is made.

The same process is now being rolled out across Lloyds’ intermediary brands, beginning on 18 April with new applications for BM Solutions residential interest-only mortgages.

A Lloyds spokesperson said: “It is absolutely our aim to have the same processes in place for interest only across all of our distribution channels. Requiring evidence of repayment vehicles is a very important step and allows us to review changes we made in earlier stages.”

Lloyds capped the amount it would lend on interest only to £500,000 in May last year alongside limiting of the types of repayment vehicles it accepts. Last month, it lowered the LTV limit to 75%.

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