HSBC breaks post-crisis barrier with 6.5-times salary mortgages for top-tier customers

HSBC breaks post-crisis barrier with 6.5-times salary mortgages for top-tier customers

Briefly

"HSBC has become the first major UK lender since the financial crisis to offer homebuyers loans worth up to 6.5 times their salary, in a move signalling the loosening of mortgage lending rules across the banking sector. The new deal, launched this week for HSBC Premier account holders, raises the maximum income multiple available on residential loans beyond that of any other high street bank. To qualify, customers must have at least a 10 per cent deposit and either earn £100,000 a year or hold the same amount in savings or investments with the bank."

"The offer marks a significant shift in mortgage policy for the lender, which was once among the market's most conservative. In September, HSBC increased its income cap for first-time buyers to 5.5 times salary; its latest change extends that to select high earners, outpacing rivals such as Nationwide, which lends up to six times income through its Helping Hand scheme, and Halifax, which caps at 5.5 times for borrowers with larger deposits."

"Mortgage broker Aaron Strutt, from Trinity Financial, said the move shows how competitive the market has become. "HSBC has gone from being one of the more conservative lenders to being more generous than virtually any other bank or building society," he said. "This income stretch mortgage is punchy to say the least, and borrowers will really need to think carefully before taking on such a large amount.""