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Barclays tightens LTI criteria

Barclays has tightened its LTI criteria by limiting applications for loans of over 80 per cent LTV at a maximum of 4.5 times income.

Previously, borrowers with an income of less than £50,000 were allowed to borrow up to 4 times income over 85 per cent LTV, with borrowers earning over £50,000 allowed to borrow up to 4.5 times income.

The maximum LTI for lending under 80 per cent LTV is 5.5.

From the start of this week, however, the lender has lowered the LTV at which the LTI caps kick in, meaning residential applications will be capped at 4.5 times income for borrowers with less than a 20 per cent deposit.

A spokesman for Barclays says: “Our LTI criteria on residential applications will be capped at a maximum of 4.5 with LTV thresholds greater than 80 per cent.

“This change is part of our on-going business planning and something we always keep under review.”

Start Financial Services manager Tom Cleary believes Barclays has tightened its criteria to control volumes.

He says: “When Santander lowered their cap from 6 times income to 5 times income last year, Barclays was left as probably the biggest mainstream lender where you could get 5.5 times income up to 85 per cent LTV.

“I think they will likely have received a significant bulk of the market’s applications since then and will be looking to control that flow with this move, because at the moment they do have their head above the parapet.”

The Bank of England announced in June that from 1 October 2014, all lenders with mortgage books greater than £100m would be required to cap the volume of loans above 4.5 times income to 15 per cent of new lending.

Lloyds, Accord, RBS and Aldermore are among the lender which have introduced LTI caps.


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  • Grey Haired Underwriter 27th January 2015 at 10:00 am


    The lower interest rate just means that the payment shock will be even bigger when their discount/fixed rate finishes.

  • Base Player 20th January 2015 at 2:43 pm


    I think the multipliers are a maximum level of borrowing someone would be able attain, it is likely that Barclays dont use the mutiples as to decipher the amount to lend just the limit a person can borrow to, should it be affordable.
    A bigger deposit means a better interest rate, meaning your payments are smaller, meaning you would able to borrow more with it remaining affordable.

    The mortgage market is no longer on size fits all.

  • Grey Haired Underwriter 20th January 2015 at 10:19 am

    Isn’t it fascinating that MMR introduced a net affordability calculator on the basis that multipliers were a crude and inefficient way of assessing affordability! Or perhaps LTI isn’t just the renaming of the multiplier. And can someone please tell me why a bigger deposit would enable an applicant to borrow more? Last time I looked LTV didn’t pay the mortgage