Coventry Building Society has loosened its affordability requirements for borrowers who receive an annual bonuses.
The lender now accepts 50 per cent of the average of the latest two year’s annual bonus, or 50 per cent of the most recent year’s figure – depending on which is lower. Previously, the lender would not consider annual bonuses when calculating affordability.
Chadney Bulgin mortgage partner Jonathan Clark says the latest criteria shift, coupled with low product rates and high fees, is an attempt to gain market share and take on the bigger lenders in the market.
Clark says: “This is a great move from Coventry and sets them up as a real player. They have some fantastic rates at the moment, they pay one of the highest proc fees of any major lender and now they’ve opened up their affordability, which shows they want to take on the likes of Nationwide and Santander and gain market share.
“Coventry’s affordability calculator has been a bit old-fashioned and essentially they have been working off income multiples but this move brings them back into the fray and I think will generate considerable business for them.”
Coreco director Andrew Montlake says: “This is a very good move from Coventry which will help more borrowers access the funds they need.”