Nationwide is calling on the government to review the LTI flow limit after its figures show that higher LTI lending made up 23% of its first-time buyer mortgages in 2024.
Currently, mortgage lenders are limited to lending no more than 15% of new loans to customers borrowing at or above 4.5 times their income, commonly referred to as the ‘LTI flow limit’.
New industry data from CACI shows that Nationwide lent to more first-time buyers than any other bank or building society in the UK in 2024.
Nationwide provided over 180,000 mortgages in 2024 – with over one in three of these to first-time buyers.
This was supported by Nationwide increasing lending from 5.5 to six times’ income in late September through its Helping Hand mortgage boost, which enables higher loan to income lending and a maximum of 95% LTV.
Helping Hand launched in April 2021 and accounted for 23% of Nationwide’s first-time buyer mortgages in 2024. In 2020, the average loan size for first-time buyers was £159,000 and in 2024 it was £197,000. For those who benefitted from Helping Hand, the average loan size last year was over a quarter higher (26%) at £249,000.
To help more first-time buyers, Nationwide is now calling on the government to review the LTI lending cap.
Last month, the government and FCA confirmed that they are considering relaxing mortgage affordability rules to boost first-time buyer lending, including reforms to loan-to-income caps and financial stress-testing rules that limit how much first-time buyers can borrow.
Henry Jordan, Nationwide’s Director of Home, said: “We believe it’s important to put first-time buyers first given how tough it is to get on the housing ladder. Our enhanced Helping Hand mortgage is extremely popular with first-time buyers and we are committed to finding new ways to ease affordability. Increasing the loan-to-income lending cap would also enable lenders to support more first-time buyers.”
