HSBC raises maximum mortgage loan sizes for many borrowers
HSBC for Intermediaries has raised the maximum mortgage loan sizes many applicants can borrow.
The changes, which took effect on Wednesday, July 10, increase the amount of borrowing available on residential home purchases and remortgages. HSBC's changes are good news for first-time buyers with smaller deposits and those seeking larger mortgage loans.
HSBC customers with a 5% deposit can now borrow £570,000 rather than £500,000, and borrowers with a 25% deposit could borrow £3 million rather than £2 million.
Mortgage lenders use loan-to-value banding systems to calculate the rate borrowers pay and the maximum loan amount. Banks and building societies can also have different maximum loan size calculations, depending on the borrower type, such as first-time and next-time buyers.
New HSBC capital repayment mortgage lending limits:
· 5% deposit maximum mortgage loan size raised from £500,000 to £570,000.
· 10% deposit maximum mortgage loan size raised from £550,000 to £750,000.
· 15% deposit maximum mortgage loan size raised from £750,000 to £2m (increased to £1m for flats).
· 25% deposit maximum mortgage loan size raised from £2m to £3m (£3m for flats).
· 30% deposit maximum mortgage loan size raised from £2m to £3m (£3m for flats).
New HSBC interest-only mortgage lending limits:
· 50% deposit maximum mortgage loan size raised from £2m to £3m.
· 35% deposit maximum mortgage loan size raised from £2m to £3m.
· 25% deposit maximum mortgage loan size raised from £1m to £2m (increased to £2m for flats).
Does HSBC offer competitively priced mortgages?
Aaron Strutt, product director at Trinity Financial, says: “HSBC normally has some of the most competitively priced fixed and tracker mortgages, although the maximum loan sizes were not as large as some of its competitors. These changes will help them lend more money and attract more borrowers.
“Santander for Intermediaries recently increased the maximum mortgage loan size from £570,000 to £1 million for borrowers with a 10% deposit.”
Metro Bank for Intermediaries recently increased the maximum loan size applicants can borrow if they have a 10% deposit from £675,000 to £1.125 million for non new build properties. For borrowers with 15% deposits, Metro’s maximum loan size has increased significantly from £1m to £2m.
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The information contained within was correct at the time of publication but is subject to change
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