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Santander ups large loan LTV limits and max borrowing amounts

  • 05/04/2024
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Santander ups large loan LTV limits and max borrowing amounts
Santander has made a number of changes to lending policy across large loan and interest-only products, as well as its maximum loan sizes.

Effective from 9 April, the maximum loan to value (LTV) for loans more than £1m up to £2m will rise from 75% to 85%. 

For loans of more than £2m and up to £3m, the maximum LTV will go up from 70% to 75%. 

Santander said it would also raise the maximum loan amounts to align with these changes. 

For residential fixed rate mortgages up to 75% LTV, the maximum loan size will increase from £1.5m to £3m, while up to 85% LTV this will go up from £1m to £2m. 

Santander will withdraw all large loan products at 60%, 70% and 75% LTV, fixed for two and five years, with a £2,499 fee for loans above £1.5m and £5m. 

It will launch two- and five-year fixed large loan products at 60% LTV with a £1,999 fee for loans above £3m and up to £5m. 

No changes will be made to residential tracker mortgages. 


Interest-only and affordability changes 

Santander will increase the maximum loan term for interest-only mortgages from 25 years to 40 years for both new and existing borrowers who are increasing the interest-only amount. 

Where the repayment vehicle is the sale of the property, the lowest equity required will rise from £250,000 to £300,000. This will apply to new and existing borrowers raising the interest-only amount. 

Where any part of a mortgage is on an interest-only basis, the maximum LTV for overall lending will be 85%. 

For borrowers with a combined gross income of £200,000 or more, lending over 75% LTV must be on a capital and interest basis. Where borrowers have a combined gross income of less than £200,000, any lending over 50% LTV must be on a capital and interest basis. 

Santander will also update its affordability calculator to account for the 2024/25 tax changes. 

It will raise the Child Benefit threshold from £50,000 to £60,000, but this will not be included where the applicant receiving the benefit or their partner’s total gross income is more than £60,000. 

Last month, Santander reviewed its affordability policy to allow Universal Credit benefits to be considered as a secondary income.

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