David Morris, head of homes at Santander UK, said: “Homeownership is part and parcel of the British psyche, and we know that for many, realising these aspirations can be challenging.
“That’s why we welcome the PRA’s updated guidance on LTI flow limits, which will enable more people to achieve their homeownership ambitions.”
He said Santander had been one of the first lenders to launch sub-4% deals earlier this year and update its affordability rates so customers can borrow up to £35,000 more, which is “making a tangible difference to what customers can afford”.
“Given our focus on the first-time buyer market, we have further updates in train, which could support 5,000 more first-time buyers, and we’ll continue to look at additional ways we can help aspiring homeowners, given the potential to go above the 15% limit.
“While the changes to LTI flows help ensure there remains a strong pipeline in terms of ‘demand’, ‘supply’ must also keep apace, and we welcome those initiatives that respond to the increasing demands that a growing population has on housing stock, such as the government’s 1.5 million new homes ambition, which will play a vital role ensuring there remain sufficient properties,” Morris said.
Aldermore Insights with Jon Cooper: Edition 9 – Why lending strategy is becoming more central in buy to let
Sponsored by Aldermore
Earlier this week, the Prudential Regulatory Authority (PRA) and Financial Conduct Authority (FCA) said they would allow lenders to seek permission to breach the 15% high-LTI limit.
Nationwide came out soon after the announcement, saying it would be seeking permission to surpass the cap and adding that it would allow it to assist around 10,000 more first-time buyers per year.
The lender then went on to relax the criteria for its Helping Hand range, with the minimum income being lowered.
Yorkshire Building Society quickly followed suit, saying it will lend up to 5.5 times income for first-time buyers borrowing at 95% loan to value (LTV) following the LTI changes. This will initially be done through its Accord Mortgages arm.
Ben Merritt, director of mortgages at Yorkshire Building Society, suggested that the change would allow it to help 2,000 more first-time buyers get onto the property ladder per year.
