Virgin Money has revamped its interest-only criteria.
In a note to brokers today, the lender said it had reduced its minimum income requirement from £100,000 to £50,000. This is based on total gross income, including 100 per cent of bonuses and overtime.
It has also removed the requirement for the property to be worth £500,000 and has introduced a maximum loan-to-income multiple of 3.5 for interest-only and part and part loans.
Virgin says: “We understand that interest only and part and part loans can be a suitable repayment method for a wide range of customers who can demonstrate confidence in repaying their loan at the end of its term, through a clear and evidenced repayment plan.”
Chadney Bulgin mortgage partner Jonathan Clark says: “The minimum income requirement is a bit tough but the other changes will bring Virgin Money in line with other lenders offering interest-only options and introduce some competition to an already under-served are of the market.”