Halifax changes mortgage lending rules so two adults with two dependents with a household income of £75,000 could potentially borrow £38,000 more
Halifax for Intermediaries has changed its mortgage affordability calculations, meaning many customers can borrow more. The maximum loan available for typical customers may increase by around 13%.
From today, 15 April, Halifax has reduced the stress test rates used in its standard affordability calculation and enhanced affordability with 5-year+ fixed products and for some like-for-like remortgage applications.
These changes will benefit customers wanting to purchase or refinance their homes. For example, a typical household of two adults with two dependents, a household income of £75,000, and average credit commitments could see the amount they can borrow increase by £38,000. This assumes a 25% deposit, a 2-year product, and a 25-year term.
Aaron Strutt, product director at Trinity Financial, says: "This is a significant change from Halifax that will make it easier for people to borrow more money to get on the property ladder, remortgage, or move home. The current tight mortgage affordability stress tests are a real issue, meaning that many potential borrowers are being told they cannot afford mortgages when they probably can.
"Santander recently made similar affordability changes, which means other lenders will probably ease their lending rules as well. Many schemes help first-time buyers and higher earners get more generous mortgage loan sizes, but in many cases, families struggle to borrow the amount they need.
Banks and building societies offer different income multiples depending on the applicant's income and expenditure. As a rule, borrowing between four and six times single or joint salaries is possible.
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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