HSBC is boosting the maximum loan to value (LTV) for select buy-to-let (BTL) loans and lowering select residential rates.
The lender said the maximum LTV for its BTL mortgage range will be upped to 80% for loans up to £400,000, and the new range has rates beginning from 5%.
HSBC said the changes to its BTL range mean that borrowers can buy a property with a smaller deposit.
The firm noted that it was reducing rates on hundreds of residential mortgages across all LTVs and different buyer types, with the changes coming into effect on 12 March.
Changes are being made across its entire residential mortgage range, with cuts of up to 0.2% for two-year fixed rates and 0.17% for five-year fixed rates.
For example, its two-year fixed rate for home purchase and first-time buyers at 90% LTV with a £999 fee has been cut by 0.14% to 4.85% and its fee-free version has been lowered by 0.2% to 5.15%. Both come with £250 cashback.
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The two-year fixed rate range for premier remortgage customers starts from 4.11% at 60% LTV with a £999 fee.
Oli O’Donoghue, HSBC UK’s head of mortgages, said: “We are continually evolving to help people with their home buying aspirations, whether that is someone buying their first home to help provide financial security for their family, someone coming to the UK from abroad and putting down roots or someone looking to take on a buy-to-let property to supplement their income.
“There is still strong demand in the buy-to-let market, and by increasing the maximum LTV on our range up to 80% LTV, we are making purchasing a buy-to-let property more accessible to people and providing greater flexibility, enabling a reduced deposit and increasing the borrowing power of the applicant.”
Santander cuts BTL affordability rates
Santander said it had lowered BTL affordability rates so clients could borrow more when buying or remortgaging.
For standard deals, the affordability rate has been lowered from 7.15% to 6.99%, while its five-year fixed rate and pound-for-pound remortgage rate has been cut from 5.15% to 4.99%.
The lender said full mortgage applications submitted from 12 March will be assessed under the new lending policy and material changes to existing applications from 6am will be reassessed under the new lending policy.
