Move aims to improve access for credit-impaired borrowers amid growing demand
Digital lender Atom bank has increased the maximum loan-to-value (LTV) on its Near Prime mortgage range to 90%, broadening access for borrowers with limited deposits and minor credit issues.
The Near Prime range includes two-, three- and five-year fixed rate products, available with and without fees. Rates at the new 90% LTV level start at 6.84% for two-year fixes, and 6.69% for three- and five-year options.
The move follows a period of continued expansion and pricing adjustments to Atom’s Near Prime products, aimed at supporting borrowers not typically served by high street lenders. The bank has lowered rates on the range twice since the beginning of the year and introduced new fixed term options.
The lender has also made changes to its credit criteria over the past year. These included increasing the threshold for unsatisfied registered defaults from £1,000 to £2,500 and relaxing limits for missed payments on communication and utility bills. The timeframe for assessing defaults was also shortened from three to two years. It has also removed fees for missed payments and arrears management.
The decision to raise the maximum LTV comes after a sharp increase in application volumes. February 2025 marked the bank’s highest month for Near Prime mortgage applications since entering the segment, up 70% year-on-year. Over the 12 months to February, application values rose 62%.
“The record-breaking interest that we are seeing in our Near Prime range is a clear indication of our growing reputation among brokers for supporting this area of the market,” said Richard Harrison (pictured), head of mortgages at Atom bank. “Brokers are seeing more clients who have suffered a temporary payment problem as a result of the last few years, and while the issue may only have been short-term, the impact on their borrowing prospects threatens to be far longer lasting.
“By raising our maximum LTV for Near Prime mortgages to 90%, we can support far more borrowers, many of whom could be first-time-buyers, to not only purchase their home but take the first steps towards regaining Prime status.”
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