Precise widens interest-only criteria with higher LTV and no equity floor

Specialist lender Precise has expanded its residential interest-only proposition, increasing maximum loan-to-value limits and removing a longstanding minimum equity requirement.

The lender has raised interest-only availability to 75% LTV and removed the minimum equity threshold where the repayment strategy is the sale of the property. Previously, borrowers using this route were required to retain at least £150,000 in equity.

The changes are intended to give brokers greater flexibility when structuring affordability solutions, while opening up interest-only lending to a broader pool of residential borrowers.

Precise’s refreshed range includes both two-year and five-year fixed-rate options. Eligibility is driven primarily by loan-to-value and the suitability of the chosen repayment strategy, rather than minimum equity levels.

By increasing LTV limits and removing equity constraints, the lender said it aims to support customers looking to upsize and use the sale of their property as their repayment vehicle. The updated criteria may also benefit borrowers with less than perfect credit profiles who are seeking time to improve their financial position.

A clear and evidenced repayment strategy remains a core requirement. Precise will continue to accept repayment via the sale of the mortgaged property, savings or investments, pension lump sums, or the sale of an additional property, with all plans fully assessed during underwriting.

Adrian Moloney (pictured), group lending distribution director at OSB Group, said: “We’re really proud to introduce these affordability enhancements, following direct feedback from brokers and the recent launch of our forty-year term.

“Today’s changes ensure more residential customers can benefit from appropriate affordability support where interest only is suitable.

“With the ONS reporting continued house price growth, our focus on flexible affordability solutions is more important than ever. We’ll keep listening to our intermediary partners and evolving our proposition to support responsible lending.”