For interest-only applications the maximum LTV continues to be 50% , however to provide greater flexibility for clients they can now consider part and part applications up to 75% LTV provided the interest-only amount is not greater than 50% and the remainder is on a capital and interest basis.
Abbey said that this would create "greater flexibility" for brokers and clients alike, and that where sale of an applicants' main residence was the chosen repayment vehicle for a interest-only or part and part mortgage it would still require a minimum equity buffer of £100,000.
Miguel Sard, managing director of Abbey for Intermediaries, said:
"We are committed to supporting the housing market and borrowers in today's market conditions.
"Our maximum LTV for residential interest-only borrowing remains unchanged at 50% LTV but by now allowing ‘part and part' applications up to 75% LTV where the remainder of the borrowing is on a capital and interest basis, we can offer new and existing interest-only borrowers greater flexibility, whether they are moving home or remortgaging to us from another lender."
Abbey is also reducing the minimum property value required for buy-to-let mortgages from £100,000 to £75,000, it says this decision follows feedback from brokers.
Mr Sard added: "We have seen strong demand for our buy-to-let offering since its launch last December and reducing the minimum property value to £75,000 will allow more non-professional landlords to apply for a mortgage with us, particularly those outside of London and the South-East.
"We are committed to supporting intermediaries and their clients with great products and service and we will continue to work closely with our intermediary partners to enhance our offering."
