Barclays has made several enhancements to its mortgage policies, enabling customers to borrow more when buying a home. The lender has made three key changes covering self-employed, interest-only and buy-to-let customers.
For self-employed homebuyers, Barclays will now accept 100% of net profits (profit after tax/PAT) in its affordability assessments and has also reduced the minimum loan threshold for PAT acceptance, benefitting self-employed homebuyers who will now be able to borrow more and against a wider range of homes.
For interest-only mortgage applications where there is at least £500,000 in equity, Barclays has increased the maximum LTV to 75%, where the repayment vehicle is sale of property.
Barclays has also introduced higher maximum loans for buy-to-let. For new build properties, Barclays has raised maximum loan size from £500,000 to £550,000 at 60-75% LTV. For flats, the lender has increased from £500,000 to £550,000 at 70-75% LTV.
These enhancements are the latest in a series of changes Barclays has made to improve affordability for homebuyers. Earlier this year, Barclays announced changes to its affordability calculations that allowed a family to potentially borrow up to £30,750 more. It also increased its maximum loan amounts for high LTV purchases across all of its mortgages, to £640,000 for houses and £310,000 for flats, enabling more buyers to access homes in higher price brackets with just a 10% deposit.
In addition, Barclays has introduced several new propositions supporting home ownership, including Mortgage Boost - which allows family or friends to ‘boost’ the amount that can be borrowed towards a home without having to lend or gift money directly - and a zero deposit mortgage for Right to Buy applicants.
