A slight reduction in income multiples for loans more than 85% loan-to-value (LTV) where borrowers have an income greater than £50,000 has been applied, taking the cap down from 4.5 times to 4.49 times income.
For non standard lending, which covers the Help to Buy and Family Springboard schemes, mortgages greater than 85% LTV where the borrower earns less than £50,000 and for mortgages where the debt-to-income ratio is equal to or greater than 20% income caps remain the same.
These are 4.4 times, and four times income respectively.
All changes were first applied this morning.
For cases with an ‘accept’ or ‘accept with documents’ offer already, the offer will proceed as before. For cases with a ‘refer’ decision, the new income cap criteria will apply.
The maximum loan amount that can potentially be offered will be capped in line with the new loan-to-income criteria.
Pre-contract variations including any increase to borrowing or LTV will be assessed under the new income multiples policy, said Barclays.
If a fee is added to the loan, this will be included in the income multiple calculations.
A Barclays spokesman said: “Following a review of our income multiples lending criteria, as of 31 March 2015, our loan-to-income cap on residential applications will increase to a maximum of five times for all loans above £300,000. For standard lending below this level, a maximum cap of 4.49 times will apply. This change is part of our ongoing business planning and something we always keep under review.”
