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Post updated: May 20th, 2025
More first time buyers will be able to borrow 6 x their salary with just a 5% deposit, due to changes to affordability rules announced by Nationwide.
The lender says the change will benefit all types of borrowers, including first-time buyers are eligible for its Helping Hand mortgage. Nationwide says that applicants will be able to borrow on average £28,000 more due to the change. While under the new rules, if you’re remortgaging you may be able to borrow over 6 x your salary. Click here to jump down to this section.
In January, Nationwide announced that it had extended the loan-to-income ratio on its Helping Hand mortgages to help first time buyers who are struggling to borrow enough to buy a home.
This meant that a first-time buyer couple with a joint income of £50,000 can now borrow up to £300,000 with Helping Hand compared to £225,000 from a lender that lets you borrow 4.5x income.
Previously, Nationwide’s Helping Hand deal allowed borrowing up to 5.5 times income, a move followed by some other major lenders.
However, these mortgages are only available if you’re taking out a five or 10-year fixed-rate deal. Applicants will also need to meet the lender’s eligibility and affordability checks.
Nationwide adjusted its mortgage affordability calculation in May 2025 by reducing its standard stress rate and the rate applied to eligible first time buyers and home movers fixing their deal for at least five years.
This means borrowers may be able to borrow more on a mortgage and the move follows the FCA’s clarification around lender flexibility in how they set their stress rates.
These changes mean more first time buyers may be able to borrow 6 x their salary on a mortgage.
Nationwide has published the following example (with the caveat that it’s illustrative and that the amount that can be borrowed will be dependent on individual circumstances):
First time buyer Helping Hand Mortgage example
David Hollingworth, Associate Director, Communications at L&C Mortgages, says, ‘Affordability remains one of the key areas preventing customers turning their homebuying aspiration into a reality. Stress rates help build in some headroom to homeowners’ monthly budget, allowing them to better deal with rising rates. Taking a more measured approach should give more flexibility to the right customers but still providing balance against over exposing borrowers in future.’
‘Nationwide has a strong focus on first time buyers and lower stress rates will hopefully help more reach toward the higher end of the maximum 6x income, that it can offer through its Helping Hand proposition.
‘Those coming to the end of a deal could also benefit. Customers with concerns that they wouldn’t meet a new lender’s criteria, due to the higher rate environment, could find that affordability is now more generous than they thought. That should open up more choice from the open market rather than necessarily having to stick with an existing lender.
The best mortgage rates for a Helping Hand mortgage are for those with the biggest deposits. For a smaller 5% deposit, here’s what you’d pay:
This worked example shows it’s worth shopping around. But you don’t have to lift a finger. Speak to our partners at L&C Mortgages and you can get fee-free advice. Set them to work and they’ll search over 90 lenders to find the right deal for you.
Get fee free mortgage advice from our partners at L&C. Use the online mortgage finder or speak to an advisor today.
We know how tough it is for first time buyers. In fact, a report by the Building Societies Association, of which Nationwide is a member, has suggested first time buyers were facing the toughest conditions in 70 years to buy a house.
But the good news is that competition between mortgage lenders has intensified in recent months as they clamour for business. And there are some new mortgage options designed to help first time buyers.
For example, Skipton Building Society has made changes to its 100% Track Record mortgage to allow people to buy a new build flat with no deposit and increased the maximum mortgage term from 35 to 40 years. The lender also launched a 100% Shared Ownership Track Record mortgage.
Some alternative ways to buy a home if you’ve got a small deposit include:
Stay up to date with our Best first time buyers mortgage rates guide – we bring you the best mortgage rates in the UK whatever your deposit size, from 0% to 40%. While this will give you the overview, it’s still advisable to speak to a fee-free mortgage broker. They’ll do the hard work for you and shop around to find you the best deal.
Get fee free mortgage advice from our partners at L&C. Use the online mortgage finder or speak to an advisor today.
Nationwide says changes to its affordability rules will benefit all types of borrowers and the lender says the largest boost to the borrowing amount is expected on remortgages where there is no additional borrowing.
It gives the following illustrative example which shows a loan to income ratio of 6.18, although note this example is over a 40 year term.
Remortgage example
Get fee-free remortgage advice from our partners at L&C. Use the online remortgage finder or speak to an advisor today.
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