The shift was triggered when the Financial Policy Committee (FPC) relaxed how the high-loan-to-income (LTI) flow limit applied to individual lenders.
As a result, 18 lenders increased their maximum LTI multiple after the change.
Demand-side changes
Now, 20 lenders offer a LTI of six times or above, including Barclays, NatWest, HSBC, Nationwide and Leeds Building Society, all of whom crossed the six times threshold in the past year.
The average borrower income rose only marginally, and the average LTI sought has increased from 3.8 times to four times. The proportion of cases that requested five times or above rose from 11% to 15%.
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The average maximum loan offered via MBT rose from £270,000 to £330,000. The proportion of cases with no affordable or eligible lender fell from 14% to 9%.
Although, for borrowers specifically seeking six times, 61% still could not find an eligible lender, though this is down sharply from 86% a year ago.
Overall, the six times threshold remained conditional: income, loan-to-value (LTV) restrictions and borrower-type criteria meant outcomes varied on a case-by-case basis.
Tanya Toumadj, managing director of MBT, said: “What we’re seeing is the market starting to reflect reality: borrowers genuinely need to borrow more, and more lenders are willing to meet them there.
“But ‘more lenders offer six times’ does not mean six times is available to every borrower – conditions vary enormously, and the gap between the right lender and the wrong one has never been wider. That’s precisely why whole-of-market affordability research matters so much right now.”
