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Virgin Money removes interest-only LTI cap

  • 18/01/2024
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Virgin Money removes interest-only LTI cap
Virgin Money will remove the interest-only cap for loan to income (LTI), which previously stood at 4.49x income.

The LTI rules at Virgin Money are now the same whether a mortgage is capital and interest, interest-only or part and part.

The lender noted that the change around interest-only will allow more customers to get the loan amounts they need, and brokers can support more customers.

For purchase or remortgage with additional borrowing, the LTI cap is 4.49x income for those earning under £50,000, five times income between £50,000 and £74,999 and 5.5x for those with an income of £75,000 or more.

A maximum LTI income of 4.49x limit will apply if the loan is over 85 per cent loan to value (LTV), the applicant is self-employed or for shared ownership.

For remortgage with no additional borrowing, up to 85 per cent LTV the LTI limit is 5.5x income and over 85 per cent LTV the limit is 4.49x income.

If a customer is remortgaging with no additional borrowing, their income and self-employment don’t affect LTI limits, the lender added.

The changes come off the back of affordability changes it made in December, with its maximum mortgage term expanding to 40 years, with more customers able to borrow up to a maximum 5.5x LTI limit.


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