HSBC has eased stress test calculations for homebuyers and remortgagers, adding that the move will mean some first-time buyers will be able to borrow an extra £39,000.
The high street bank says these changes come into effect immediately and could allow 20,000 more customers to arrange a mortgage with the lender.
Earlier this month, Lloyds Banking Group, which owns Halifax, made similar changes, as did Santander in March.
HSBC UK head of mortgages Oli O’Donoghue says: “This adjustment to our stress rates, which will directly improve affordability for many aspiring homeowners, reflects our commitment to making homeownership more accessible.
“By carefully reviewing our affordability calculations, allowing more customers to meet affordability criteria and potentially access increased borrowing amounts, we are aiming to ease some of the pressure on prospective buyers so more people can realise their dream of owning their own home.”
The moves from these lenders come after the Financial Conduct Authority said last month that lenders have been “too cautious” in granting FTB home loans under current rules.
FCA chief executive Nikhil Rathi told the Treasury Committee in March that under existing regulatory rules lenders have a degree of “flexibility” over the stress tests they apply to homebuyers coming to the market for the first time, which they have not exercised.
