Nationwide will offer lending at up to six times income at 95% loan to value on new build homes for first-time buyers.

The mutual’s Helping Hand mortgage boost product allows FTBs to borrow a third more than the standard high LTV lending at 4.5 times income in the range.

The lender will also lift the maximum LTV for borrowers who want to buy a new build house to 95% on 26 June. It will increase the maximum LTV for new build flats to 85%.

The firm will also lengthen its offer period for new build properties from six to nine months.

It says: “Although the vast majority of new build purchases complete within a six-month period, this change will give customers and brokers greater certainty and flexibility during the construction process.

“The longer offer period reduces the risk of needing to reapply for the mortgage in the event the property takes longer to complete.”

Nationwide director of home Henry Jordan adds: “These changes have the potential to meet the strong FTB demand for new builds that has gone unmet since the end of Help to Buy, while also stimulating the construction sector to build more homes with the confidence that buyers can get a mortgage on them.”

The business also renewed its call for Bank of England’s Financial Policy Committee to lift its loan-to-income cap on lenders issuing loans at or above 4.5 times a borrower’s income to no more than 15% of their total loans.

The mutual says: “Nationwide is continually having to manage its lending relative to that limit and these positive changes to its maximum LTVs for new build properties will add volume which may require further action to ensure Nationwide remains within the limit.”

Jordan adds: “Without a review of the high loan-to-income limit, this potentially significant change for FTBs, the construction sector and growth more broadly, will be constrained in terms of impact.”