Skipton eases loan-to-income limits following regulatory changes

Skipton Building Society has relaxed its income criteria following the recent move from the PRA to enable more high loan-to-income (LTI) lending.

Skipton is lowering the minimum income threshold from £50,000 to £40,000 for borrowers seeking an LTI above 4.49x - one of the lowest minimum income thresholds available on the market.

The Society can now offer an LTI of up to 5.5x up to 90% LTV and 5x LTI above 90% LTV for those with incomes of £40,000 or more, across the full product range, subject to affordability.

This means borrowers with a total application income of £41,000 and a 10% deposit could previously borrow up to £184,090. With Skipton’s new criteria changes, they can now borrow up to £225,500 - that’s over £41,000 more, a 22% increase on what they could have previously borrowed.

In addition to this, Skipton is increasing the maximum LTI ratio on its 100% Track Record mortgage from 4.75 to 5 times income.
 
Borrowers with a household income of £60,000 applying for Skipton’s 100% Track Record Mortgage without a deposit could previously borrow up to £285,000. With the new criteria change, they are now able to borrow up to £300,000 - an increase of £15,000 (5%).

Charlotte Harrison, CEO of Home Financing at Skipton Building Society, said: “We’ve campaigned for change to the Loan-to-Income rules to better support first-time buyers, so it’s really positive to see the PRA respond, and we’re proud to be taking immediate action following that shift.

“The changes we’ve announced today are a practical step that will make a real difference, by helping even more people take that first step onto the property ladder while ensuring we continue to lend responsibly.

“The PRA has estimated LTI changes could support an additional 36,000 first-time buyers into homeownership each year. We look forward to working closely with regulators and industry partners to build on this progress.”