Santander has become the first major British lender to reduce the affordability percentages for residential borrowers who want to buy or remortage.
From today, the rates in all homes with the lender have been reduced by a maximum of 0.75%, the lowest levels that have been seen since 2022.
This means that many customers who apply for a residential mortgage from Santander UK can now borrow between £ 10,000 £ 35,000 more than yesterday.
The total difference that can be borrowed depends on the individual circumstances of a customer and subject to affordability controls and loan of income limits.
The lender says that the move is a response to the call from the FCA earlier this month for lenders to improve the affordability rates and design products more in accordance with the needs of customers, in a market where interest rates are falling.
Santander UK Head of Huizen David Morris says: “Helping customers in reaching their home owner dream is an important priority for Santander, but we know that affordability restrictions continue to bite.
“We are pleased to be the first large lender who responds to the updated FCA guidelines, in addition to the introduction of a series of reduced mortgage interest today, play our role as responsible lender and help more customers to borrow what they need to release their home ambitions.”
Earlier this year, Santander made three important commitments to brokers, with the aim of improving the mortgage intermediary experience.