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TSB returns to 90 per cent LTV for self-employed

  • 05/03/2021
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TSB returns to 90 per cent LTV for self-employed
TSB has returned to 90 per cent loan to value (LTV) lending for self-employed borrowers and increased the amount of bonus, overtime and commission income that can be used to support the application.


The bank introduced a temporary cap of 75 per cent LTV where one or more borrowers are self-employed in November. It said this was to ensure it continued to lend responsibly during the pandemic and protect service levels.

According to the lender’s website, the loan to income ratio remains at 4.25 times income.

TSB will once again accept 60 per cent of overtime and commission based on the latest three-month average and has returned to a policy of 60 per cent of bonus income, paid weekly, fortnightly or monthly.

If the bonus is paid quarterly, half-yearly or annually it will not be accepted.

The maximum mortgage term for 90 per cent LTV deals has also been increased to 40 years, up from 30 years.


Product options

Alongside the changes to its lending policy, TSB has added three and five-year fixed rates to its Fix and Flex range, available up to 90 per cent LTV. The range offers early repayment charges (ERC) that expire before the product end date.

The three-year option starts at 1.34 per cent, for borrowers with a 40 per cent deposit. At 90 per cent LTV two rates are available; 3.44 per cent with a £995 fee and 3.84 per cent with no fee. ERCs expire after two years.

A five-year alternative is available from 1.59 per cent. At 90 per cent LTV the £995 fee deal is priced at 3.69 per cent and the zero fee option is 3.89 per cent. ERCs expire after three years.

Between 85 per cent and 90 per cent LTV the maximum loan is restricted to £500,000.

TSB’s three-year Fix and Flex product will be available to first-time buyers, home movers and remortgage customers immediately and for buy-to-let customers it is available from end of March.

TSB director of mortgages Roland McCormack (pictured) said: “In the current environment, we know customers want to feel more confident about the mortgage they choose without the worry of being tied in for too long, our new three-year Fix and Flex product is designed to do exactly that.”


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