TSB still offering 5.5 times salary mortgages to higher earners
TSB for Intermediaries is still one offering enhanced mortgage affordability calculations and competitively priced rates for higher earners.
The bank changed its mortgage affordability rules just over a year ago to try to attract higher earners seeking larger loans. It offers up to 5.5 times salary income multiples for those earning over £100,000 or five times salary mortgages for borrowers earning over £60,000.
The table below shows the basic mortgage affordability calculations TSB uses to give an indication of how much people can borrow. Click here to use our mortgage borrowing calculator.
|
Income |
Loan-to-value |
Mortgage income multiples |
|
Earning more than £100,000 |
<85% (more than a 15% deposit) |
Up to 5.50 times income |
|
>85% (less than a 15% deposit) |
Up to 4.49 times income |
|
|
Earning more than £60,000 |
<85% (more than a 15% deposit) |
Up to 5.00 times income |
|
>85% (less than a 15% deposit) |
Up to 4.49 times income |
|
|
Earning less than or equal to £60,000 |
<90% (more than a 15% deposit) |
Up to 4.49 times income |
|
>90% (less than a 10% deposit) |
Up to 4.25 times income |
Source: TSB for Intermediaries
What is TSB's mortgage criteria?
1. Your Income: TSB will use 100% of basic income, 60% of overtime and bonuses, and 100% of self-employed income for affordability purposes. The bank also lends to contractors, limited company directors, people on maternity leave or partners of PLC or LLPs.
2. Your Expenses: The calculations used to generate the maximum loan size include your current debts, living expenses, and other financial commitments. The maximum loan size is likely to reduce when you have background buy-to-let properties, outstanding credit cards, car lease agreements, student loans, overdrafts, private school fees or childcare costs.
3. Credit Score: You are likely to need a clear credit history to qualify for a mortgage with TSB. The bank prefers clients with higher credit scores, which results in better mortgage terms and a higher borrowing limit. TSB currently undertakes a credit check on all mortgage applicants through Experian and TransUnion and additional checks to verify the applicants' identities.
4. Deposit Amount: The size of your deposit will impact the loan-to-value ratio, which affects the maximum amount you can borrow. TSB offers mortgages to borrowers with a 5% deposit, although its most competitively priced rates are available to those with a 40% deposit.
5. Interest Rates: TSB currently offers two-year fixes, two-year base rate tracker mortgages, and five-year fixes. The bank offers different rates for borrowers depending on whether they are purchasing or remortgaging a property.
6. Term of the Mortgage: The length of the mortgage term can impact your monthly payments and the total amount you can borrow. TSB's maximum term is 40 years if the residential mortgage is to be conducted on a full repayment basis. The maximum term is 30 years if all or part of the residential mortgage is to be conducted on an interest-only basis. This also applies to any part of the lending on a repayment basis.
7. Property Type and Value: The type and value of the property you want to purchase can also influence the amount you can borrow.
8. TSB's Interest-only Criteria: TSB offers interest-only mortgages to borrowers with a 25% deposit. The lender also allows some borrowers to take out part interest-only mortgages.
The minimum income required for sole applicants to secure interest-only is £75,000 based on the gross amount used for affordability. The minimum income required for joint applicants is £75,000 for one applicant or a combined minimum income of £100,000 for both applicants, again based on the gross amount used for affordability.
9. Large Mortgages Loans: TSB previously set up a bespoke team for brokers like Trinity Financial to negotiate the more complex £750,000+ mortgages.
Strong competition to attract borrowers across the mortgage market
Aaron Strutt, product director at Trinity Financial, says: "There is a lot of competition between the lenders now, not only with mortgage pricing but also with mortgage acceptance criteria.
"Our brokers have access to a wide range of banks and building societies trying to attract all types of borrowers, from first-time buyers and home movers to people looking to refinance for a more competitively priced deal."
Call Trinity Financial on 020 7016 0790 to secure a mortgage, book a consultation, or complete our mortgage questionnaire.
The information contained within was correct at the time of publication but is subject to change.
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