The move, which is designed to increase lending flexibility, will be available across all full status applications.
Beacon’s affordability lending model uses a calculation which assesses an applicant’s expected net income, living costs, and existing loans, to determine an affordable mortgage repayment amount. A reasonable loan size is then calculated based on a given reversionary rate and term.
Clive Willson, head of sales at Beacon Homeloans, said: “Our move to affordability lending is an extremely positive one, and will allow us to offer realistic loan amounts that are in context with applicants’ monthly outgoings.
“In a market where the ratio between house prices and salary levels are stretched to say the least, affordability lending can often enable those who are able to meet given monthly repayment costs the extra lending flexibility they need. At the same time the model prevents those who are already financially committed from over stretching themselves.
“At Beacon we believe whole-heartedly in responsible lending and this model ensures that borrowers will only commit to a level of debt they can easily service.”
