Nationwide, the UK’s largest building society, has announced two significant updates to its mortgage lending criteria. These changes aim to make borrowing more accessible for a wider pool of customers, including those seeking interest-only mortgages and foreign nationals.
The building society’s latest move comes as part of its ongoing efforts to increase support for borrowers, offering more flexibility in its lending approach.
Nationwide is raising the maximum loan-to-value (LTV) on interest-only loans and extending better borrowing opportunities for foreign nationals, a group often excluded from many lending schemes.
Changes to Interest-Only Lending
One of the key changes made by Nationwide concerns interest-only mortgages. The maximum LTV for these loans will now rise to 75%, a notable increase from the previous ceiling of 60%.
This change is designed to provide greater flexibility for borrowers who prefer to make interest-only payments for the initial period of their mortgage.
According to Henry Jordan, Nationwide’s Director of Home, the new LTV increase helps more borrowers access the option of interest-only lending, which remains a preferred choice for some.
“These latest changes continue our efforts to support as many borrowers as possible, whether it’s purchasing a new property or looking for a new deal on their existing mortgage.” he stated. Nationwide hopes this move will meet the needs of homeowners looking for flexibility in their mortgage terms.
Foreign Nationals Benefit from Improved Lending Terms
Another significant update focuses on foreign nationals. Nationwide is expanding its lending options for this group, particularly those without Indefinite Leave to Remain (ILR) in the UK. The maximum LTV for foreign nationals will now increase to 85%, up from the previous 75% limit.
This change will provide more opportunities for individuals who meet other eligibility criteria but have not yet acquired permanent residency status in the UK.
Additionally, Nationwide is removing the previous requirement for foreign nationals to contribute at least 25% of the total deposit from their own funds. These changes are seen as a step forward in ensuring that more foreign nationals can access competitive mortgage products.
This shift comes at a time when demand for flexible borrowing options is rising, particularly among foreign nationals who often face stricter lending terms due to their immigration status.
Stephanie Daley, Director of Partnerships at Alexander Hall, remarked on the significance of this update, calling it a “game-changer” for many customers.
