Hodge is introducing significant criteria enhancements to its later life mortgage products in response to the ongoing cost of living crisis.

From 9 October, Hodge will increase income multiples on purchase and remortgage on later life products.

It announced it will also raise the loan-to-income (LTI) cap from 4.49 to 5 times for interest only and from 4.49 to 5.5 times on repayment mortgages.

In addition, it will reduce the stress rate for pound for pound remortgages, for which it will continue to lend up to six times income.

Finally, it will start accepting a life insurance policy to support affordability under the death stress test.

Hodge head of mortgage risk Louise Swainston says: “Affordability continues to remain a challenge for mortgage customers across the market as interest rates remain high and the cost of living continues to rise.

“To help support our intermediary partners and their customers meet affordability hurdles, we have factored the news of the decrease in the OFGEM energy price cap into our affordability assessment, as well as reducing our stress rates for like for like remortgage borrowing.”

Hodge business development director Emma Graham adds: “We have developed this package of supporting criteria enhancements to help customers, particularly those who are looking to remortgage, with any affordability issues in mind.

“In particular, we believe the relaxation of the stress testing will be beneficial to many customers at a time when they need it the most.”

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