After the financial crash struck in 2008, loans to first-time buyers were immediately slashed. There would be no more jumbo-sized mortgages of five times income or more. There would be no more 95% or 100% loans. Buyers would need a large deposit. But this week Clydesdale Bank said it will grant first-time buyers mortgages of 5.5 times a borrower’s income and lend up to £600,000 – and the buyer only needs a 5% deposit.

The product has sent shockwaves through the mortgage industry, which was plagued with accusations before the crash about “reckless lending”. In November 2006, Abbey (now Santander) began offering mortgages of five times salary. Vince Cable, then the Liberal Democrats’ Treasury spokesman, called the news “very alarming”, adding that it was “likely that these irresponsible lending practices will lead to financial disaster for many people”.

But this week’s jumbo-sized loan deal from Clydesdale goes a lot further. Abbey had required that borrowers with large loans put down a 25% deposit, but Clydesdale’s terms say that a deposit of just 5% is acceptable. However, it does require that the first-time buyer has an income of at least £40,000 and has recently qualified in a list of professional jobs including accountants, architects, chartered surveyors, dentists, doctors, pilots, solicitors and vets.

A spokesperson said: “Clydesdale Bank’s latest mortgage offer is available for a very small group of highly qualified customers ... As with all mortgage applications, our lending decisions are based on a full income and expenditure assessment to assess individual affordability, ensuring that we continue to lend responsibly.”

Other lenders have eased lending restrictions in recent years, but none has gone as far as Clydesdale.

Lenders use “affordability” tests rather than salary multiples but, according to mortgage brokers, in effect it means that Nationwide will lend up to 4.75 times income and while Lloyds (which includes Halifax) has recently increased its multiples, it will only go to five times salary, up to a maximum of £500,000, with a minimum deposit of 25%. HSBC maxes out at 4.75 times, but will lend this up to 90%. Barclays goes the furthest of the banks, lending 5.5 times income on a repayment mortgage, but the borrower has to have a minimum income of £75,000 and put down a deposit of at least 15%. Santander has also recently increased its maximum to 5.5 times income.

The other “stretch” happening in the mortgage market is to lengthen the term of the loan. While 25-year terms were the standard in the 1990s, 30 years is now the norm for new borrowers, with many lenders stretching to 35 years to make monthly payments more affordable.

But mortgage brokers said they were relaxed about Clydesdale’s new deal. David Hollingworth of London & Country said: “I think that this is more about being able to lend borrowers the amount that they can demonstrate will be affordable and to keep a degree of flexibility where appropriate, rather than a move to remove the reins on what a lender is prepared to lend.”

At brokers John Charcol, Ray Boulger says: “Most lenders’ maximum income multiple is between 4 and 4.5. The reason the cap bunches at 4.5x is the Bank of England’s Financial Policy Committee cap on lending above 4.5x income, which stipulates that no more than 15% of new lending can be in excess of 4.5x income on a rolling 12-month basis.

“For borrowers without significant other financial commitments, affordability assessments often allow a maximum loan in excess of 4.5x and so despite the regulators sensibly moving lenders away from strict income multiples to an affordability basis, most lenders have retained income multiples as well, partly to comply with the FPC rule. Because many lenders are close to the 15% allowed above 4.5x income they have to decide which type of applicants to prioritise for their 15% allowance.”