Change offers support as affordability challenges deepen in high-cost housing market
Longer-term residential lender April Mortgages has introduced revised loan-to-income (LTI) limits, allowing eligible applicants to borrow up to seven times their income on selected long-term fixed rate deals.
The enhanced criteria apply to the lender’s 10- and 15-year fixed rate mortgages and are available exclusively through intermediaries. The change is intended to assist brokers in supporting clients who are struggling to meet affordability thresholds amid the continuing imbalance between earnings and property prices.
To qualify, applicants must have a household income of at least £50,000. Loans are available up to 85% loan-to-value (LTV), with standard loan amounts ranging from £50,000 to £1 million. Larger loans up to £2 million may be considered on a case-by-case basis.
The mortgages are open to homebuyers and those seeking remortgages on residential properties in England and Wales. New-build homes and buy-to-let properties are excluded. Borrowers must be under 80 at the end of the loan term, which can extend up to 40 years.
The move follows recent changes to the lender’s affordability assessment criteria. Last month, April Mortgages increased the proportion of variable income types – such as bonuses, commission, and overtime – that can be included in affordability calculations, from 50% to 80%. The policy aims to help applicants with non-standard income streams, particularly first-time buyers, movers, and those seeking like-for-like remortgages. The initiative enables borrowers to secure loans up to 25% larger than previously possible.
The criteria changes reflect growing affordability challenges in the market. Data from the latest UK House Price Index shows the average house price stands at £268,000. April Mortgages noted that under the revised model, a household earning £60,000 a year could potentially access a loan of nearly £420,000 – a significant increase compared to the more common LTI ceiling of 4.5 times the income.
“Affordability continues to be one of the biggest barriers for borrowers, as wage growth struggles to keep pace with rising house prices,” said James Pagan (pictured), director of product, portfolio and operation at April Mortgages. “For many, homeownership feels increasingly out of reach. By raising income multiples to up to seven times on our 10- and 15-year fixed rate products, we’re giving brokers a powerful tool to help clients with strong earnings but limited borrowing options under standard LTI caps.”
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