This comes after the Financial Conduct Authority (FCA) asked lenders to consider the flexibility already within lending rules, which could allow people to access larger mortgages.
It said this ahead of plans to review mortgage lending rules and look at alternative ways to stress test borrowers.
From 28 March, Santander’s residential affordability rates have been reduced by up to 0.75 percentage points, which the bank said brought them to their lowest levels since 2022.
All residential affordability rates have been reduced by up to 0.75 percentage points, bringing them to the lowest levels since 2022.
Santander said this would allow customers applying for a residential mortgage to borrow between £10,000 and £35,000 more than previously, depending on their circumstances, affordability checks and loan-to-income (LTI) limits.
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David Morris, head of homes at Santander UK, said: “Helping customers achieve their homeownership dream is a key priority for Santander, but we know that affordability constraints continue to bite.
“We’re thrilled to be the first major lender to respond to the updated FCA guidance, alongside introducing a range of reduced mortgage interest rates today, fulfilling our role as a responsible lender while helping more customers to borrow what they need to release their home aspirations.”
This article was first published on YourMortgage.co.uk‘s sister site, Mortgage Solutions. Read: Santander lowers affordability rates in response to FCA request
