Mortgage loan sizes vary more now than ever

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The gap between the average maximum and minimum loan sizes available to mortgage applicants is now at the widest it has been since Mortgage Broker Tools (MBT) started reporting the data within its Affordability Index.

The latest MBT Affordability Index has found that in June 2022, the gap between the minimum and maximum loan offered to an average mortgage customer reached more than £133,000. This is up substantially from just over £104,000 in the same month of 2021, and the highest seen since MBT started recording this data in January 2021, when the gap was slightly more than £88,000.

While the spread of loan sizes available to mortgage applicants is as large as it ever has been, the proportion of mortgage enquiries where customers are offered the loan size they want has remained stable at 76%.

Tanya Toumadj (pictured), CEO at Mortgage Broker Tools, said: “The increased cost of living is now being factored into lender affordability calculators. The impact of this is greater on those with lower incomes and as such this month’s MBT Affordability Index has seen a significant decrease in the average minimum loan size available to customers. Consequently, we are seeing greater disparity between maximum and minimum loans available to borrowers.

“However, there are still lenders able to provide the loan sizes that borrowers are requesting and our data shows that more than three quarters of mortgage enquiries are still able to secure the loan size requested from at least one lender.

“In this environment, comprehensive research amongst a wide group of lenders is vital to ensure that clients are able to access the loan size they need. While previously this might have meant endless legwork and hours on the phone, a tech platform is now the broker’s best weapon – and MBT Affordability is the most comprehensive lender panel out there. It should be the first stop for brokers looking to ensure that their clients get the best deal possible.”

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