Big News: Santander Loosens Affordability Rules – What It Means for You
Hi everyone – Shaun here from Sturgess Mortgage Solutions.
There's been a major shift in the mortgage market this week, and it’s something I think a lot of people – especially first-time buyers – will want to know about.
What’s Happened?
Santander has officially eased its mortgage affordability criteria, meaning borrowers could now access up to £35,000 more than they previously could. That’s a big change.
Essentially, Santander has adjusted how it stress-tests mortgage affordability. Before, they’d check whether you could still afford your mortgage if interest rates jumped 1% above their standard variable rate. Now, they’ve revised those calculations to reflect a slightly lower stress-test range – typically around 6% to 7%. In real terms, this means many buyers will see an increase in the maximum they can borrow.
What Does This Mean for First-Time Buyers?
For first-time buyers, this change could be a real game-changer. Let’s say a couple has a combined income of £49,500 – under the new criteria, they could now borrow up to £210,000, which is around £14,000 more than they may have been offered just last week.
That kind of extra borrowing capacity might be the difference between buying a flat or a house… or simply being able to offer on the property you really want.
The Wider Impact on the Housing Market
With one of the UK’s biggest lenders making borrowing more accessible, it’s likely that others will follow. This could increase overall buyer activity, especially in places like South Wales, where affordability is already better than in many parts of the UK.
However, while this is great news in terms of opportunity, it’s really important that people still borrow responsibly. Just because you can borrow more, doesn’t always mean you should. It’s all about making sure your monthly payments are comfortable and fit your lifestyle, especially if interest rates change again in future.
Final Thoughts
Santander’s move signals a potentially more flexible and buyer-friendly approach from lenders in 2025. If you’ve been holding off from speaking to a mortgage broker because of strict affordability rules, this could be the time to reassess.
As always, if you want to find out exactly what this means for you – whether you're buying your first home, moving, or looking to remortgage – I’m here to help.
Pop into our Gorseinon office, give us a call, or drop us a message – we’re always happy to talk through your options.
.jpg)
