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TSB introduces blanket LTI cap

TSB has introduced a 4.5x income multiple cap on all mortgage applications.

All applications submitted on or before 24 February will continue to be processed under the previous cap of 5.5x income.

In a broker note issued today, the lender says it has “made this decision in response to changes in the market.”

Barclays introduced the same 4.5x income cap across all applications last month, while NatWest, Royal Bank of Scotland, and Lloyds Banking Group have a cap on income multiples for loans above £500,000.

Santander is understood to have a limit of five times income on residential applications, depending on affordability calculation results, though it has not confirmed the exact loan-to-income cap.

TSB last month widened its distribution to nine major distributors and 73 directly authorised firms following a trial launch with London & Country. The lender currently offers residential mortgages for purchase only, but is expected to launch a range of remortgage products in the coming weeks.

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