You can now get a £300,000 mortgage with a £50,000 household income

Source metro.co.uk

A UK bank has revolutionised the mortgage application process by allowing first-time buyers to borrow up to six times their income. Nationwide has become the first major lender to offer couples collectively earning £50,000 the chance to borrow up to £300,000. For perspective, providers traditionally offer between four and five times the applicant’s salary – though this can lock many out of a spot on the housing ladder. The average UK house price is now £282,000, according to Gov UK, while ONS places typical weekly earnings at £651 (roughly £33,852 per year, which would require a considerable deposit to say the least). The situation gets bleaker in London, where property prices have spiked to such an extent that the average house now sells for £687,044 (as per figures from Rightmove). Over the last year, terraced properties have fetched even higher amounts at an average of £789,601.

How does Nationwide’s new mortgage scheme work?

The Helping Hand mortgage translates to a 33% uplift when compared with the company’s standard lending agreement, which comes in at around 4.5 times the applicant’s income. It’s been in place since 2021, but the latest agreement has seen the value increase.Since it was first implemented, it’s proved particularly effective in London and the South West, where first-time buyers have qualified for loans approximating £269,169 (compared with the market average of £168,699). ‘This latest move from Nationwide is aimed at supporting the government’s housing ambitions and shows the value of being part of a modern mutual that is run for the benefit of its members,’ the building society’s website reads. ‘Helping Hand has supported around 40,000 people onto the property ladder since we launched it three years ago. We want to do more and are boosting the scheme to six times income and increasing the maximum loan size,’ Debbie Crosbie, Nationwide’s Chief Executive, adds.‘This, alongside our most recent rate cuts, further strengthens our market-leading position and demonstrates that, as one of the UK’s largest lenders, Nationwide continues to put first-time buyers first.’

---