Accord Mortgages is increasing its maximum loan to value (LTV) to 85% on residential purchase mortgages and is also increasing its maximum property value for residential lending from £1 million to £2 million.
Lending was limited to a maximum of 75% LTV at the end of March as a response to the government restrictions on physical property valuations. Since then, the intermediary lender has used desktop valuation or an automated valuation model (AVM) on all new and pipeline applications and is now confident it can increase the maximum LTV and maximum property value.
From 8am on Friday 15 May, there will be 11 new fixed-rate residential purchase products available at either 80% or 85% LTV.
- A two-year fixed rate at 1.87% at 80% LTV with £495 fee, £500 cashback and free valuation
- A two-year fixed rate at 2.08% at 85% LTV with £495 fee, £500 cashback and free valuation
- A five-year fixed rate at 2.00% at 80% LTV with £495 fee, £500 cashback and free valuation
- A five-year fixed rate at 2.16% at 85% LTV with £495 fee, £500 cashback and free valuation
For both residential purchase and remortgage Accord will lend up to £1,500,000 at 75% LTV and up to £1,000,000 at 85% LTV.
The changes will be further supported by valuers returning to work in line with the latest government advice. All new applications will be subject to a physical valuation where possible, although brokers should be aware that to ensure the safety of all those concerned, appointments will be reduced and specific guidelines adhered to, which could impact timeframes.
The reinstatement of physical valuations also means that both residential and buy-to-et applications on flats and non-standard construction can be accepted once again. New build lending is not included in these changes and is being considered separately.
Jeremy Duncombe (pictured), director of intermediary distribution at Accord Mortgages, said: “We have the desire and capacity to lend and our priority has always been to ensure we can offer the widest range of products with the highest level of service. Rather than reduce restrictions too early and leave applications in the pipeline, we are now in a strong position to accept cases at a higher LTV and property value. This provides increased choice to brokers and their as well as offering much-needed support to the market.
“Following the Prime Minister’s address on Sunday (10 May), our valuation partners are re-commencing physical valuations this week in a controlled manner to reduce any potential risks. We are working closely with them to process any new applications as well as review our current pipeline, which we acknowledge will take time. We will continue to monitor the situation and review our range, reintroducing products and criteria when it is prudent and feasible to do so.”
Yorkshire Building Society and Chelsea Building Society are also increasing their maximum LTV to 85% on residential purchase products and maximum property value for residential lending will rise from £1m to £2m.