Boost for first-time buyers after mortgage rule change

First-time buyers could get wider access to mortgages after the Bank of England (BoE) loosened its rules on lending.

- KARL MATCHETT BUSINESS EDITOR

Until now, just under 10 per cent of new mortgages issued are for valuations exceeding 4.5 times the income of a borrower. That is now set to rise to 15 per cent across the industry, with some building societies and banks now able to offer an even higher number of new mortgages at that level.

BoE estimates suggest 36,000 extra mortgages with higher loan-to-income ratios could be handed out each year as a result of the change. With the government chasing economic growth and Labour pledging to build 1.5 million new homes during this parliament, alterations to rules across both finance and housebuilding have been in focus this year.