Couples given £130,000 boost under new mortgage rules
Santander's decision to relax its home loan criteria benefits both couples and single borrowers, who can now secure much larger mortgages.
Thousands of couples will be able to borrow £130,000 more after Santander became the latest lender to relax its mortgage lending criteria.
The bank has eased its rules to allow homebuyers to borrow up to 5.5 times their income, including loan to value ratios of 90% or 95%.
And this means a couple with an £80,000 deposit, where one earns £75,000 a year and the other makes £50,000, would be able to borrow £687,500 under the changes, Sky Money Blog reports.
That’s up £131,000 from before the changes, when the maximum would have been £556,500.
For a single homebuyer, with a £30,000 deposit, earning £75,000 a year, the new Santander criteria releases an extra £33,000, taking their maximum loan to £300,000.
Lenders react
It was announced recently that new mortgage rules designed to help first-time buyers, the self-employed and people borrowing in retirement were being proposed.
The Financial Conduct Authority (FCA) put forward the draft rules to see how lenders react.
The FCA earlier unveiled a plan to scrap affordability checks for homeowners looking to remortgage, giving them access to potentially cheaper deals.
Borrowing doubled
Net mortgage borrowing more than doubled to £2.7 billion during June from £1.3 billion the month before, the latest Bank of England data revealed.
The figures marked the second consecutive monthly rise as lower mortgage rates fuel buyer confidence and market activity.
Buyers get big affordability boost thanks to new lending rules
