Loughborough Building Society has increased its upper lending cap to help applicants who are able to afford a larger loan but are held back by their income.
The society has increased the cap from 4.5 times an applicant’s income to 5.5 times for borrowers who can prove they can afford the extra amount.
Loughborough stated it recognised that some borrowers were able to afford a loan but that the income multiple had reduced their borrowing power.
To qualify, a sole applicant would need to have an income of £50,000 while joint applicants must have a combined income of £75,000, but there is no restriction on profession.
Suitable borrowers can take out a 2.45 per cent discounted rate for two years with a £999 completion fee while the maximum loan to value is 85 per cent and the maximum loan size is £750,000.
Ashley Pearson, Loughborough’s building development manager, said: "It’s great that we’re able to help even more borrowers afford their dream home.
"It’s important to take a common-sense approach to lending which I believe we do every day."
Nick Morrey, product development manager at John Charcol, said the announcement from Loughborough was a step in the right direction for borrowers.
He said: "Going to 5.5 times income is something we are seeing more of at present but what sets this version of enhanced income multiples is the fact that there is no restriction on profession.
"Quite a few lenders offer similar income multiples but only to what they describe as ‘professionals’ – accountants, lawyers, doctors and vets for example.
"To go to 85 per cent up to £750,000 of borrowing gives a purchase price of £882,000, which should encompass much of the UK, matching this with the ‘case by case’ underwriting attitude the Loughborough have as a smaller building society means another decent option for borrowers.
"It would be even better if Loughborough could offer some fixed rate products to go with the new criteria."
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