TSB self-employed mortgage increase
TSB Bank has announced a significant change to its mortgage lending criteria, increasing the maximum loan-to-income (LTI) multiple for self-employed applicants. From today, self-employed individuals seeking a mortgage may be eligible to borrow up to 5.5 times their income, marking one of the highest LTI limits currently available for this group in the UK. In this blog we will explore the new TSB self-employed mortgage increase changes.
New Loan-to-Income Limits for Self-Employed Applicants
The updated lending criteria, effective 17 June 2025, offer increased borrowing capacity for self-employed buyers, particularly those with higher incomes. The key changes are as follows:
| Income Bracket | Loan-to-Value (LTV) | Maximum Income Multiplier |
|---|---|---|
| More than £100,000 | Less than 85% | 5.50 times income |
| More than 85% | 4.49 times income | |
| £75,000 to £100,000 | Less than 85% | 5.00 times income |
| More than 85% | 4.49 times income | |
| £74,999 or less | Less than 95% | 4.49 times income |
Why This Change Matters For Self-Employed Borrowers
Self-employed individuals have traditionally faced more stringent lending criteria compared to salaried workers. Income verification complexities and perceived financial risk often limit borrowing potential for this group, making homeownership more challenging.
TSB’s decision to raise the LTI multiple to 5.5 times income for high earners at lower loan-to-values could open new opportunities for self-employed buyers, allowing them to access larger mortgages based on their earnings. This change acknowledges the growing number of self-employed professionals and entrepreneurs in the UK, reflecting a more flexible approach to underwriting their mortgage applications.
Impact on the UK Mortgage Market
This move by TSB comes at a time when many lenders remain cautious about high LTI ratios amid economic uncertainties. By increasing borrowing limits for self-employed applicants, TSB may gain a competitive edge in attracting this expanding segment of the market.
Potential buyers with incomes over £100,000 can now potentially borrow significantly more, especially when opting for loans below 85% LTV. Those with moderate incomes between £75,000 and £100,000 will also benefit from a higher LTI of up to 5 times income, subject to similar conditions.
What Self-Employed Borrowers Should Consider
While higher LTI multiples offer increased borrowing capacity, prospective borrowers should carefully assess their financial situation and long-term affordability. Lenders will still require comprehensive income evidence and affordability checks before approving a mortgage.
Self-employed individuals interested in applying with TSB should consult mortgage advisors to understand how the new criteria may affect their eligibility and explore the best mortgage deals available.
TSB’s increase in the maximum loan-to-income ratio for self-employed applicants signals a positive shift in mortgage lending practices, offering greater borrowing power for a group that has faced tougher restrictions in recent years. This development may help more self-employed people realise their homeownership ambitions in the UK property market.
If you are self-employed and looking for a new mortgage, or just want to know more about the TSB self-employed mortgage increase then please feel free to give our team a call today. We are here to help.
