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Coventry reduces interest-only LTV to 50%

Coventry Building Society has cut its maximum LTV for interest-only lending from 75% to 50%.

The change is effective across both its direct and intermediary brands from tomorrow.

A spokeswoman for Coventry says: “Following moves by a number of other lenders to restrict their criteria for interest-only lending the Coventry has also reduced the maximum LTV to 50% where any aspect of the loan is interest-only.

“This will apply to residential, offset  and further advance applications to ensure that our lending policy remains in line with the market. Our buy-to-let lending policy remains unchanged.”

The move follows an announcement by Nationwide yesterday that it is cutting its interest-only LTV from 75% to 50%.

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  • shock horror 21st March 2012 at 10:58 pm

    Lending policy has nothing to do with TCF

    Remember, it’s the MMR consultation documents that refer to interest only as ‘niche’

  • Richard Scott 21st March 2012 at 2:43 pm

    Further mortgage prisoners being created here. Lenders are clearly not taking account of their existing customers on interest only for valid reasons. They will be forced to remain where they are particularly if they are approaching the end of their terms and can’t afford to revert to repayment basis, because of lenders age restriction criteria implemented over the last 2 years means almost no one can take a mortgae into retirement. These people face the prospect of having no choice but to be forced to sell their properties and rent. These people are being penalised by knee jerk decisions being made by lenders in the face of MMR which is looking forward to preventing issues, but fails to take account of customers who have been allowed by the same lenders under the same regulator to do what they have done. Its time for someone to open their eyes!

  • Graham Kennedy 21st March 2012 at 9:56 am

    This move by lenders is just not right. To restrict the loan to value to 50% where any element is Interest Only and with a suitable repayment vehicle is most deifintely NOT Treating Customers Fairly. Just who is going to put a stop to all this nonsense???? If I see another lender email saying “to allow us to continue to treat customers fairly…..”. As I see frequently in these messages “last one out shut the door”. Good bye.