The lender said it was making the move in order to be prudent and to continue to lend responsibly in ‘unprecedented times’ and ‘an uncertain mortgage market’.

Existing members, it said, would continue to benefit from a maximum 95% LTV if they switch deals, providing they do not increase the LTV. Nationwide will also consider applications from existing mortgage customers moving home where the LTV is above 85%.

However, first-time buyers, home movers and remortgage customers who are new to the society will only be eligible if they require an LTV of 85% or below.

Nationwide said it needed to ensure borrowers could afford mortgage payments and were protected against negative equity should house prices fall.

Henry Jordan, director of mortgages at Nationwide Building Society, said: “The outlook for the mortgage market and house prices remains uncertain.

“As a responsible lender we must factor this uncertainty into our lending assessments, which is why we have taken the decision to reduce our maximum LTV for new business.

“Our priority at this time must be to help members keep their homes. As such, we need to ensure our members can afford their repayments, while doing what we can to protect them from falling into negative equity.

“We will continue to keep this situation under review and hope to return to lending at higher LTVs in the near future.”

Nationwide is also reducing fixed rates at 60% LTV by up to 0.1% for borrowers remortgaging to the building society. Two-year fixed rates will now start from 1.09% with a £1,499 fee and five-year fixed rates from 1.40% with a £999 fee.