Changing how we assess affordability

We’ve made changes to how we assess affordability to make homeownership more achievable. 

By reducing our affordability stress rate, it means an average customer could access up to £28,000 more toward the cost of their home, representing a 13% increase based on the average mortgage amount and term for lending above 85% LTV.

This change is designed to support all types of borrowers, especially first-time buyers who may have found difficulty in affording mortgages previously. It provides greater flexibility for customers navigating a challenging housing market. For example, a first time buyer earning £50,000 with a 10% deposit could see their borrowing increase by around £21,500, while a home mover earning £75,000 with a 10% deposit could access up to £40,000 more toward their next home.

Alasdair McDonald, Head of Intermediaries commented: “Supporting people into homes of their own is is at the heart of what we do in the mutual sector. By updating our affordability approach, we’re helping more customers access the borrowing they need in a responsible and sustainable way.”