Coventry for Intermediaries improves affordability model

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Coventry for Intermediaries has widened elements of its lending policy with changes to its affordability calculations.

The lender has improved its income multiples from 4 to 4.49 times for loans with an LTV greater than 90%. The changes are effective now and any pipeline applications will proceed onto the higher amount.

Annual bonuses will now also be accepted – 50% of the average of the latest two years’ annual bonuses, or 50% of the most recent year’s annual bonus figure, if lower.

In addition, 50% of regular bonus payments will be accepted for affordability purposes – the last three month’s evidence must be provided to show a consistent level of earnings.

Jonathan Stinton, head of intermediary relationships at the Coventry Building Society, said: “Increasing the income multiples and allowing more flexibility on bonuses will increase the options available to those clients who want to get onto the property ladder.

“Building up a deposit for a mortgage is one of the bigger challenges facing buyers and this has been made all the more difficult with such strong market demand and rising property prices. We’ve consistently supported the market at higher LTVs and these extra measures will help to broaden the choices for those with smaller deposits who are looking to buy now.”

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