HSBC starts offering up to 6.5x salary mortgages to higher earners!
Quick Summary
Which lender offers the highest earners the most generous mortgages? Well... HSBC mortgages has started to offer up to 6.5 times salary income multiples to HSBC UK Premier account customers. The income multiple is much more generous than many of the other mortgages on the market, but applicants will need an annual income of at least £100,000 paid into the HSBC Premier account to qualify. Trinity's brokers can help qualifying customers open a premier account as part of the application process.
HSBC mortgages has started to offer up to 6.5 times salary income multiples to HSBC UK Premier account customers.
Where an application is 90% loan-to-value or less, so the borrower has at least a 10% deposit, HSBC will apply a loan-to-income of 6.5x single or joint incomes, subject to an affordability assessment.
Please note, in order to qualify for the higher loan-to-income at least one applicant must hold a Premier account at the point of submission. This is something Trinity's brokers can do for customers, providing they meet the premier account requirements.
UK Premier Account Eligibility:
- Annual income of at least £100,000 paid into the HSBC Premier account or
- Savings or investments of at least £100,000 with HSBC in the UK or
- International Premier status, already a Premier customer elsewhere
Will borrowers need to opt for a two- or five-year fix for HSBC's 6.5x salary mortgages?
HSBC has also enhanced its affordability calculator to allow us to select a Premier customer and access the new loan-to-income multiples. The mortgage affordability calculator will now show two maximum loan amounts based on whether a rate of less than five years or five years or greater is selected, providing additional options for customers’ borrowing needs.
Aaron Strutt, product director at Trinity Financial, says: “HSBC has gone from being one of the more conservative lenders to offering up to 6.5 times salary to higher earners. This policy change means they are more generous than virtually all of the other banks and building societies.
"We know the lenders are keen for business but this income stretch mortgage is punchy to say the least and borrowers will really need to think carefully before they take on such a big income multiple.
"Applicants will probably need to lock in for five years to get the highest loan amount, so this does provide a bit more payment security. I am pretty sure this change will get HSBC a lot more business, especially as many applicants only need slightly more generous loan sizes to buy the properties they want. Affordability is clearly a huge issue in the mortgage and property markets and HSBC is trying to address this."
A few months ago HSBC increased its loan-to-income (LTI) ratio for first-time buyers. The lender is now offering first-time buyers LTI multiples of up to 5.5 times their salary on mortgages. Sole applicants earning at least £35,000 and joint applicants with a combined income of £55,000 or more will be eligible for enhanced borrowing.
Other lenders offering up six times salary mortgages but their rates are unlikely to be as well priced as HSBC's. Check out our blog on how many lenders offer 6 times salary mortgages.
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