Indication of lending policies relaxing in UK

The UK’s second largest lender Abbey has relaxed its lending criteria in what is a major boost to the country’s mortgage market and an encouraging sign that lenders’ appetites for debt could be improving.

As of Friday this week Abbey will increase its maximum LVR from 60 to 70 per cent on its best available fixed rate deals – two years at 3.65 per cent or four years at 4.69 per cent, The Times Online reported.

According to the news source, Abbey’s move follows a similar decision by Barclays owned lender Woolwich.

The Australian mortgage market has recently seen lending policies tighten with the major lenders’ maximum LVRs reducing to between 90 and 95 per cent and new genuine savings policies in force.