Principality BS pulls back on interest-only

Principality Building Society has become the next lender to restrict its interest-only offering, following other lenders including Santander, Leeds and Coventry Building Society.

The Welsh lender is still offering interest-only or part interest-only deals up to 85% Loan to Value (LTV), where it lent across its range before.

Its 85% LTV deal is available on a three-year discount rate, with a discount of 0.3% from its standard Variable Rate (SVR), currently 4.99%.

The lender will continue to offer 75% and 50% LTV deals available at a three-year 0.5% and 1.4% SVR discount respectively.

A Principality spokesperson said: "Many lenders have either chosen to withdraw from the interest-only market or reduce their maximum LTV from 75% to 50%. We recognise that some borrowers still need access to higher LTV products in this space and therefore we have maintained our maximum loan to value for interest-only at 75%, to offer borrowers flexibility in this market."