Foundation cuts residential rates and increases max loan size

Furthermore, deals are now available at 65, 75 and 80 per cent loan to value (LTV), a move the lender said would make its mortgages accessible to more clients. 

As part of the update Specialist Lending Solutions revealed earlier this week, Foundation removed its 60 and 70 per cent LTV deals, replacing them with a 65 per cent range.

Its previous low rate of 2.79 per cent at 60 per cent LTV is available at 65 per cent LTV instead. In addition, the loan size at 65 per cent LTV has increased from £1.5m to £2m. 

At 75 per cent LTV, initial rates for F1 and F2 borrowers have seen reductions of up to 0.2 per cent on fixed rates and 0.1 per cent on discount rates. 

F1 borrowers are those who just miss mainstream mortgages due to their credit history, while F2 borrowers are those with credit blips. 

For F1 borrowers, the two-year fixed at 75 per cent LTV has been reduced from 3.59 per cent to 3.39 per cent and the two-year variable has gone down to 3.29 per cent from 3.59 per cent.  

The five-year fixed at 75 per cent LTV has seen a reduction to 3.79 per cent from 3.99 per cent.  

F2 borrowers seeking a 75 per cent LTV mortgage will see the two-year fixed rate cut from 3.79 per cent to 3.59 per cent and the variable cut from 3.59 per cent to 3.49 per cent. 

The five-year fixed has been reduced to 3.99 per cent from 4.19 per cent.  

All products have had their initial rates extended by three months. 

Jeff Knight, director of marketing at Foundation Home Loans, said: “The specialist residential market is undoubtedly changing and the likelihood is advisers will be seeing a significant growth in clients who, for many reasons, miss out on the mainstream or will have accumulated credit blips, perhaps as a result of the Covid-19 lockdown. 

“These changes simplify our residential range, while building on our residential criteria improvements to include a far wider range of complex income types and sources.”