Interest only mortgage criteria change announcements.

The Leek United BS is the latest UK lender to tighten its interest only mortgage criteria, with the introduction of a 50 per cent loan to value lending cap.

Previously Leek United's interest only mortgage criteria allowed lending up to a loan to value level of 75 per cent. The lender has also announced a £100,000 minimum property valuation for mortgages lent outside the area serviced by its branches. The serviceable area is defined as 20 miles from a Leek United branch.

The Manchester Building Society has also announced a tightening to its interest-only criteria advising that such deals will now only be offered through selected channels. Interest only mortgages will remain available for buy-to-let purchase but not for residential purchase.

Ian Richardson who is the executive director at Manchester advised that the lender has experienced an increase in demand across its whole mortgage range, and has therefore taken the decision to cut back on some mortgage products offered. He adds that Manchester plan to launch new interest only products in the next few weeks.

ING Direct has also taken the decision to cut loan to value levels on interest only products from 75 to 50 per cent. The lender has announced that mortgage-holders may top up borrowing by an additional 30 per cent providing this is on a repayment basis.

With may lenders having tightened criteria for interest only mortgage lending it is hardly a surprise that remortgage demand has increased. Those looking to switch from their current interest only deal should contact Deal Direct 'whole of market' brokers for a competitive new product.