Banks will offer first-time buyers ‘more firepower’ to get on property ladder

September 1, 2025 Shehroz Malik No Comment 1 Views

atOptions = { 'key' : '935d6ab39f70f5664bb173656c8b20f0', 'format' : 'iframe', 'height' : 250, 'width' : 300, 'params' : {} };

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it’s investigating the financials of Elon Musk’s pro-Trump PAC or producing our latest documentary, ‘The A Word’, which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

First-time buyers may potentially be able to borrow more, after changes to some banks’ mortgage lending policies.

HSBC UK has announced a new, bigger loan-to-income (LTI) multiple cap of up to 5.5 times salary for first-time buyers.

The bank said the move will give “more financial firepower” to some borrowers.

The 5.5 LTI multiple is available to first-time buyers who meet specific criteria, including a minimum sole-applicant income of £35,000 and a minimum joint-applicant income of £55,000.

The additional borrowing could make the difference in enabling someone buying their preferred type or size of first home, or buying a property in their desired location for school catchment areas, or for better transport links for commuting to work, the bank said.

The previous LTI cap HSBC UK had for this type of borrower was 4.49.

Meanwhile First Direct, a brand of HSBC UK, said it was also introducing a 5.5 times LTI multiple for first-time buyers who meet specific criteria, including a minimum sole-applicant income of £35,000 and a minimum joint-applicant income of £55,000.

The new policy could mean someone with a £24,000 deposit will now be able to borrow up to £220,000 (up from £190,000 under the previous policy), allowing them to buy a home worth £244,000, subject to affordability, First Direct said.

Many lenders have recently made changes to their mortgage affordability assessments after clarification from regulators.

Oli O’Donoghue, HSBC UK’s head of mortgages, said: “A higher LTI multiple allows us to consider a broader range of applicants, but every mortgage application will still be individually assessed to ensure the borrower can comfortably manage their repayments, even in a changing economic environment.”

Liam O’Hara, head of mortgages at First Direct, said: “Affordability is at the heart of our decision-making and we are absolutely committed to being a responsible lender, so we will continue to assess applications to make sure our customers can manage repayments.