HSBC UK helps first time buyers onto the property ladder

HSBC UK today announced an enhancement to its mortgage lending policy, introducing a new Loan-to-Income (LTI) multiple of up to 5.5 times salary for first-time buyers. This new policy is designed to give more financial firepower to first-time buyers to help them get on the property ladder, while maintaining a strong commitment to responsible lending.

The 5.5x LTI multiple is available to first-time buyers who meet specific criteria including a minimum sole applicant income of £35,000 and a minimum joint applicant income of £55,000 alongside the core affordability assessment ensuring appropriate lending which is sustainable over the long term.

This additional borrowing could be the difference in enabling someone buying their preferred type or size of first home or buying a property in their desired location for school catchment areas or for better transport links for commuting to work.

For borrowers who are moving home or remortgaging, and have an income of more than £45k, there are also increases to the loan to income multiple ranging from 5.0x to 5.5x depending on LTV and income.

Oli O’Donoghue, HSBC UK’s Head of Mortgages, said: “There are significant challenges facing first-time buyers today, from finding a deposit that is likely to be tens of thousands of pounds, to rising property prices. By increasing our LTI multiple we aim to provide extra support to those who are ready to take this important step. Affordability remains central to every lending decision, but extending our lending limits will provide extra firepower to those looking to get onto the property ladder.

“A higher LTI multiple allows us to consider a broader range of applicants, but every mortgage application will still be individually assessed to ensure the borrower can comfortably manage their repayments, even in a changing economic environment. Our commitment to responsible lending is unwavering, and we believe this new policy strikes the right balance between helping aspiring homeowners and protecting them from financial hardship.”