HSBC has today announced an increase in its maximum loan-to-value (LTV) lending limits for residential mortgages. The changes, effective from today, apply to all new-build properties and flats, including non-new-build flats, across the UK. In this news article I will explore these new HSBC maximum ltv (loan to value) mortgage lending limits, and offer some insights into why this news is so significant in the UK mortgage market.
HSBC Maximum Mortgage LTV Lending Limits Increase
Under the new guidelines, HSBC has raised the LTV tiers by 5% for each property type. This increase means that the maximum LTV for new-build houses and non-new-build flats will now reach up to 90%, while the maximum LTV for new-build flats will rise to 85%. These adjustments provide borrowers with more flexibility and lower upfront costs, making it easier for potential homeowners to secure a mortgage with a smaller deposit. This is a big deal in my opinion as potential UK mortgage borrowers are currently facing the toughest mortgage affordability test that we have ever seen. An increasing number of lenders are making it more difficult for people to secure the loan that they need to finance a property, and HSBC increasing the maximum LTV for their products will be a huge help to borrowers.
HSBC Minimum Deposit Criteria
In addition to these changes, HSBC has removed the minimum deposit requirement of £25,000 for purchasing a new-build house. Again, this should further ease the path to homeownership for those who would have otherwise been unable to save a large enough deposit, particularly for those looking to enter the property market or move up the property ladder.
Expert Opinion
As a mortgage expert with a long background in new build property, I can share with you a few of my initial thoughts when hearing this news. The increase in HSBC’s LTV limits for new-build properties and flats is a timely boost for the UK housing market. With property values remaining high, especially in urban areas, the ability to borrow up to 90% of a property’s value is a significant advantage for buyers. This change will particularly benefit first-time buyers who often struggle to save large deposits while trying to enter the market. Previously we had schemes like Help To Buy and the shared ownership scheme to help new buyers onto the new build property ladder, but now lenders are having to adapt to cater for these types of buyers.
Given the complexities of the mortgage market, it’s more important than ever for buyers to consult with an expert mortgage broker. Brokers can provide invaluable guidance, ensuring that borrowers find the right mortgage deal that fits their financial situation and long-term goals. With these new LTV limits, there’s an even greater need to understand the nuances of different mortgage products and lenders’ criteria.
About Oportfolio Mortgages
At Oportfolio Mortgages we are a leading mortgage brokerage firm based in South West London. All of our advisors and administrators are experts in their field and have a wide knowledge of the UK property market. Our sole job is to help you to get the best possible deal and mortgage agreement for your own unique situation. If you are looking for a new mortgage, please give us a call or send us a message. We are here to help you.
