Scottish Widows tightens criteria on interest-only
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Scottish Widows Bank has followed in the footsteps of other lenders and restricted its interest-only lending.
It is now only offering interest-only borrowing up to a maximum 75% LTV and pricing its interest-only products 0.2% higher than repayment deals, with a maximum loan amount of £163;500,000.
The lender says these changes reflect the additional risk of interest-only lending and will allow it to continue to offer interest-only products to meet customer demand.
Lloyds Banking Group, the parent company of Scottish Widows Bank, has already restricted its interest-only borrowing while in May Northern Rock announced that it will no longer accept certain repay-ment vehicles on its interest-only mortgages.
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