Masthaven Bank has cut selected rate cuts on its residential first charge range and made changes to its lending criteria, as well as extending its automated valuation model.

The challenger bank’s rate cuts cover:

A two-year fixed-rate offer from 3.04%, down from 3.24%.

A five-year fixed-rate mortgage from 3.34%, reduced from 3.59%.

A two-year fixed-rate offer, with no fee from 3.54%, cut from 3.74%.

A five-year fixed-rate loan, with no fee from 3.64%, down from 3.89%.

All four of these mortgages are at 70% loan to value.

Also, the specialist lender says the updating of its lending criteria and the extension of its automated valuation model policy lead to four key changes.

It says additional earnings, such as bonuses and overtime are now included in affordability.

Bank statements are no longer required for all self-employed and buy-to-let cases, although the bank adds these may be needed in certain instances.

Projections are now considered for self-employed.

And automated valuation models are now considered for purchase and buy-to-let cases, and up to £350,000 on both first and second charge loans.

Masthaven director of intermediaries Rob Barnard says: “Activity in the housing market has soared since the start of the pandemic, thanks in part to initiatives like the stamp duty holiday.

“The result has been a booming market with high transaction levels and house price growth.

“It hasn’t all been plain sailing, however, and the combination of high house prices, the end of the tax holiday in July and the looming deadline for the end of the furlough scheme is likely going to bring affordability issues to the fore for some borrowers.

“These rate reductions, as well as a return to many of our pre-Covid underwriting approaches, allows us to continue supporting borrowers, brokers and the wider market.”