Nationwide has today, 3rd November, enhanced its Interest Only mortgage offering, aiming to give homeowners more flexibility.
Interest Only lending has been extended to all buyer types up to 75% loan-to-value (LTV), or up to 85% for part Interest Only, part repayment applications.
Repayment options now include not just the sale of the main home, but also UK-based savings, investments, pension funds and other properties.
Applicants need a minimum eligible income of £75,000 for sole applications and £100,000 for joint cases, unless one applicant earns at least £75,000.
The maximum loan available through Interest Only is £5m, with the maximum term increased to 40 years or until retirement, whichever is sooner.
The previous limit was 25 years.
Interest Only mortgages will now be available to first-time buyers through brokers.
Carlo Pileggi, head of mortgage products at Nationwide, said: “We are delighted to be able to expand and enhance our Interest Only offering.
“Interest Only can be a great option for customers who have a suitable repayment vehicle and want the flexibility provided by lower monthly payments.
“These changes, along with robust criteria, mean we will be able to increase the support we can provide borrowers looking for more flexibility, while ensuring Nationwide continues to lend responsibly.”
Pileggi added: “As the country’s second largest lender, it is natural that we continue to look at the products we offer, including those we make available through brokers, to ensure we can help them meet as many of their clients’ needs as possible.”
Andrew Montlake, CEO at Coreco Mortgage Brokers, said: “Nationwide’s move is a real vote of confidence in the broker channel and gives advisers more tools to deliver genuine flexibility within robust safeguards.
“Opening interest only to first-time buyers, while maintaining clear income thresholds of £75,000 sole or £100,000 joint, and keeping the proposition exclusively available via intermediaries, means customers will access the professional advice that is crucial, especially in the initial stages of their home-buying journey.
“These are thoughtful, positive changes that support brokers and broaden choice for borrowers in a responsible way.”
