It also removes the 65% and 80% loan-to-value tiers
HSBC UK has announced an increase in the maximum borrowing limits on hundreds of its mortgages, a move aimed at aiding more individuals in achieving homeownership, especially in high-cost areas.
Aside from changes in maximum borrowing limits, which will apply to both residential home purchases and remortgages, the high street lender is also simplifying its mortgage range by eliminating the 65% and 80% loan-to-value (LTV) tiers, allowing customers to access higher lending amounts at a higher LTV.
Initially, these new maximum lending limits will be available through mortgage brokers.
The revised lending limits for capital repayment mortgages are as follows: 95% LTV mortgages will increase from £500,000 to £570,000; 90% LTV mortgages will increase from £550,000 to £750,000; 85% LTV mortgages will increase from £750,000 to £2 million (up to £1 million for flats); 75% LTV mortgages will increase from £2 million to £3 million; and 70% LTV mortgages will see lending exceed £3 million.
“The affordability of a mortgage remains at the heart of any mortgage decision, but by increasing the maximum amount of money that can be borrowed as part of a home purchase or remortgage, we will be able to help more customers with their homebuying goals,” said Chris Pearson (pictured), HSBC UK’s head of intermediary mortgages.
“We’ve taken on board feedback from brokers and significantly increased the amount that can be borrowed. In the case of mortgages at 85% LTV, the maximum that could be borrowed on a house is an increase of over 150%. This could make the difference between someone being able to buy the property they want or need, or having to compromise by buying a smaller property with fewer bedrooms, or maybe in an area that is outside the catchment area of their preferred school for their children.”
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