Residential Lending Policy

The Society undertakes a thorough affordability assessment to ensure that we lend responsibly. How much you can borrow is calculated through a combination of your income, regular financial commitments and household / lifestyle expenditure and the term required at an agreed stressed rate to ensure that affordability still exists beyond the initial product rate.

In assessing affordability all unsecured loans / HPI agreements that have more than 6 months to run, credit cards and maintenance will be deducted. In addition, deductions to applicant's disposable income will also be made for declared household and lifestyle expenditure which is compared against statistical data for accuracy. We request that you obtain accurate details of your applicant's income and expenditure which will ensure a more accurate calculation. We also recommend that prior to beginning a Decision in Principle that you have ran your clients through our affordability calculator to ensure that the loan is affordable.

If you have any questions regarding the use of the calculator please check our frequently asked questions section or alternatively contact our Intermediary Support team on 0345 602 2338.

Minimum age for applicants is 18. Maximum age for borrowers at the end of the loan term is 80.

• All applicants must have at least 2 years to serve.
• Where the applicant will also live in accommodation provided by M.O.D. then they must be able to support both the new mortgage and any associated living costs for the M.O.D. property. This must be factored into the affordability assessment.
• Where the applicant will be living in M.O.D. accommodation on a full time basis then the property to be purchased must be occupied by spouse/partner.
• Where it is a sole applicant purchasing the property it must be occupied on a full time basis. It must be plausible that applicant can commute to place of work on a daily basis unless on tour overseas.
• A 3 year residency history is required. BFPO addresses are acceptable.
• We will now accept applications where the source of deposit is from the Government supported Forces Help to Buy scheme which has now replaced the Long Service Award. Acceptance of the Forces Help to Buy scheme is subject to:
  
  • The Personal Information Note supplied to the applicant by the Ministry of Defence which details the conditions in which the loan is based must be provided with the application before a Binding Offer can be issued. This will detail the monthly payment + insurance premium to be paid.
  • The monthly payment + insurance premium to be paid by the applicant must be included as a monthly commitment for affordability purposes. This would be added as an unsecured loan to the online affordability assessment.

• We will expect that the borrower's main residence is currently within the UK and that they will reside in the property whilst in the UK. We do not accept 'ex-pat' type scenario where the applicant wishes to purchase a property in the UK and return at a later date.
• We will only consider applications where the applicant's spouse/partner or immediate family will be a permanent resident in the property. The property must not be left unoccupied for more than 30 days a year.
• If the applicant is required to pay for accommodation whilst working abroad then details of this must be disclosed during the application process and deductions made within the affordability assessment.
• We would normally expect to see salary paid into a UK bank account either direct or via transfer. The salary paid must be in UK sterling. We do not accept salary paid in any other currency as we do not currently lend for Foreign Currency Loans (see below). .
• The employer must be generally 'Blue Chip' for both UK and International companies.

For those applicants who already have 1 or more investment mortgages we will consider up to 95% LTV on the basis that we receive:

• Evidence that the mortgage conduct on all investment mortgages is satisfactory with no missed payments. Sight of conduct via credit bureau data is acceptable.
• The rental income received must cover the current mortgage payment by at least 145% based on current pay rate to cover rental voids, management /maintenance costs associated.
• Where the rent received does not pass the above stress test then the shortfall will be taken as a monthly commitment for affordability purposes.
• Where applicants have a significant investment portfolio (greater than 5) then we would also expect to have sight of their BTL portfolio summary.
• Please see 'Let to Buy' for those applicants who are looking to rent out their existing property and purchase a new home to reside in through the Newcastle.
• Our full Buy to Let lending policy is available here.

• Contract workers are considered higher risk to the Society due to affordability concerns once a set contract period has ended. For this reason we would be looking for a track record of employment within the same sector for at least 2 years. This can be evidenced via last 2 P60's.
• Applicants who have fixed term contracts within professional occupations such as doctors, teachers and solicitors, will be regarded as in permanent employment. Applicants from contract workers in other fields will be considered on their individual merits.
• We require sight of current contract confirming income and duration. For applicants employed on contracts of 12 months or more we would expect there to be at least 6 months to run at the time of application. For those on shorter term contracts then we would expect there to be at least 3 months remaining.
• Written confirmation from the employer must be sought that applicant's contract will be renewed beyond the current expiry date or we have evidence that another contract has been signed with another company.
• Applicants employed through recruitment agencies will not be accepted unless a 2 year track record in the same line of work can be established. Those employed under zero hours contracts will not be accepted.
• IT contractors can be considered as long as a track record within the Industry can be established. This may be evidenced via previous contracts in conjunction with P60's or last 2 years SA302's and corresponding Tax Overview forms if self employed. If the applicant is employed via an umbrella company we will take the gross income as sighted via contract and payslips.
• Construction Industry Scheme Workers will be considered on the same basis as contractors.

• As part of our overall assessment, the Society will credit score all mortgage applications to assess the credit worthiness of applicants. Applicants will be credit scored at Decision in Principle stage and this will lead a footprint on their credit file.
• The credit score will either accept, decline or refer applications to underwriters for a manual assessment.

We offer Custom Build mortgages exclusively via BuildStore Mortgage Services who can be contacted on 0345 223 4888. Alternatively, visit their website www.buildstore.co.uk for more details. We offer Custom Build mortgages on the following basis:

• Purchase of land and traditional custom build projects
• Renovation and conversion projects
• Property types including terraced and semi-detached houses subject to an overall site assessment and input from panel valuer. Flats will not be considered at this stage.
• Traditional construction types will be considered. Modern methods of construction will also be considered subject to panel valuer input and suitable warranty and accreditation requirements.

We will consider lending up to a maximum of £600,000 at 85% LTV at the end of the build and 85% loan to costs during the build and subject to the following key criteria;

• Interest Only can be taken during the build but can only be extended beyond build completion where there is a repayment strategy that meets our criteria and LTV does not exceed 75% / 80% part and part
• Minimum property value of £100,000 based on full completion
• Funds are released on an arrears stage payment basis.

Please contact BuildStore to discuss your client's requirements in full.

The Society will use credit scoring to determine whether to proceed with an application. Applications will normally be declined in the following circumstances:

• Current secured arrears or recent history of non payment
• Current unsecured arrears or history of delinquency in last 3 years
• Any type of unsatisfied CCJ or Default irrespective of amount (£)
• Any secured or unsecured credit related CCJ or defaults within the last 3 years irrespective of when registered
• Any insolvency i.e. Bankruptcy / IVA / DRO is detected
• Any evidence of previous or current property being repossessed

Our underwriters may be willing to accept a maximum of 2 satisfied defaults below £250 from utility companies, communications or mail order with satisfactory explanation within the last 3 years. This is still subject to the whole case being good quality.

You can register and submit a residential DIP via our Intermediary website www.newcastleis.co.uk.

By registering online, you will set up your unique login details and, once approved, join our panel of advisers. We will aim to review your registration within two working hours of you applying (Monday to Friday 8am to 6pm).

Once you have been accepted, you will be able to log in and get an instant decision in principle, confirming whether a client has been approved for a mortgage with us, as well as manage DIP cases you have submitted online.

On completion of the DIP, you can now progress to full application and also submit supporting documentation via our document upload facility.

Where an applicant has been employed for less than 6 months we may require sight of the employment contract. This is instead of an employment reference which can often lead to delays in processing the application.

• Where it has been established that the property is to be purchased at a discounted price then we can consider lending 100% of the purchase price subject to valuation confirming that LTV based on open market value would not exceed 95%.
• Additional borrowing above the discounted purchase price can only be considered subject to funds being for home improvements only and LTV not to exceed 95% of open market value. No capital raising for repayment of debt is allowed.
• The acting solicitor must ensure that defective title indemnity insurance is arranged where a discounted purchase price is taking place. This protects the Society from future claims under the Insolvency Act.
• The current occupant of the property would be expected to move out of the property. We will not accept a sitting tenant and the property must be vacant on completion with no charges /restrictions from previous owner remaining.
• Maximum loan is £500,000.

• We will no longer accept mortgage applications where the salary paid in a currency other than UK sterling is to be used for affordability purposes.
• In addition, we will no longer accept other sources of income that is not UK sterling based i.e. rent received from overseas properties, overseas investments.
• Where the loan is interest only or part interest only / part capital repayment (currently not available) we are also unable to accept a repayment strategy that is based on assets that are held outside the UK.

• The maximum LTV for Non-EEA Applicants is 80% but we will consider applications above this on referral to our underwriters via a Decision In Principle
• All Non-EEA nationals must be able to demonstrate that they have indefinite leave to remain in the UK. Alternatively, professional applications on long term visas may also be considered where there are at least 2 years remaining.
• Evidence of the applicants indefinite right to remain can only be verified by either a residency entitlement stamp on passport and / or visa, or by written confirmation from Home Office/UK Border Agency

If your client has an existing mortgage and wants to borrow more/ port their mortgage to a new property they will need to speak to us directly. They can do this by;

• Calling us on 0345 606 4488 (Lines are open 8am - 8pm Monday to Friday and 9am - 3pm Saturday)
• Visiting their local branch. View our branch finder for details of your nearest branch
• Visit our website

We currently do not accept new mortgage applications that require a guarantor.

Help to Buy Equity Scheme (England) mortgages are considered by the Society subject to specific scheme rules including the following:

New Build Purchase

• The minimum acceptable lease term on new build properties is 125 years for flats and 250 years for houses.
• The maximum starting ground rent on all new build properties with a leasehold tenure is limited to 0.1% of the property value.
• Ground rent must be reasonable at all times during the lease term. For example, ground rent escalation should be linked to RPI (Retail Price Index) or a similar index, and unreasonable multipliers of ground rent will not be permitted, for example doubling every 5, 10 or 15 years.

• Borrowers must be resident in England;
• The property must be in England;
• The Maximum mortgage we will lend is £450,000 against a maximum purchase price of £600,000.
• The maximum that customers can borrow on the Help to Buy equity loan is £120,000 and up to £240,000 in London
• The Help to Buy Equity Loan must be fully repaid within 25 years from when it was taken out or on the sale of the property (whichever occurs first);
• The scheme cannot be taken in conjunction with Help to Buy Armed Forces scheme. The borrower must contribute at least 5% deposit from own funds or via a non-refundable family gift.
• NBS to hold first legal charge with Homes and Community Authority's interest secured via second charge;
• Borrowers must not have any interest in another property anywhere else in the world - if already a home owner, must have sold current home before or at the point of completion on the Help to Buy home;
• Borrowers cannot rent out an existing property to buy a second home through Help to Buy;
• Part exchange is not available through the Help to Buy scheme;
• Borrowers cannot sublet their Help to Buy home;
• House builder from whom property to be purchased must be registered to offer the Help to Buy Scheme;
• NBS will require copy of the Authority to Proceed issued by HCA before proceeding to offer;
• Should the property be down-valued when a valuation is obtained for mortgage purposes, loan amount will be reduced accordingly and NBS will require an updated Authority to Proceed issued by HCA, reflecting the related reduction in equity loan;
• For affordability purposes, the annual interest payable (or 'fee') on the Help to Buy Equity loan will be treated as a monthly commitment. 3% of the outstanding loan will be assumed for affordability purposes;
• In line with Policy for standard new build properties, a CML Disclosure of Incentives form must be completed by the developer and presented to the conveyancer prior to the certificate on title being submitted to the lender. Funds will not be released on any new build property, inclusive of those purchased under the Help to Buy Scheme until this form is received.
• Where incentives exist, we allow up to 5% incentives including deposit contributions, cashbacks, legal costs, stamp duty without deductions from the purchase price. Costs that don't have a material impact on the value of the property such as white goods, carpets, curtains are not treated as incentives.
• All New Build properties, inclusive of those purchased under the Help to Buy Scheme, must have a home warranty scheme applied. The acceptable schemes to the Society are:

NHBC
Build-Zone
LABC
Zurich Municipal
HAPM
Premier Guarantee
BLP
Protek
AHCI Advantage
ICW (International Construction Warranty)

Remortgages

Remortgages are acceptable under the Help to Buy Equity scheme on the following basis:

• It meets all of the above criteria at the time the applicants entered the scheme;
• The loan has a maximum LTV of 80% based on the current value of the property;
• No additional borrowing permitted unless this is to repay the Help to Buy Equity loan in full. Partial repayment/stair casing is not permitted and no additional funds can be used for other forms of debt consolidation / home improvements. If repaying the Help to Buy Equity Loan in full please refer to our standard residential product range.
• The new mortgage term cannot exceed the unexpired term with the previous mortgage provider i.e. if the original term was 25 years and the remortgage takes place in year 5 then the maximum term we can lend on is 20 years.
• Consent must be obtained from Target Servicing Limited who act on behalf of the Homes and Communities Authority (HCA). In order for Target to provide consent the customer /acting solicitor must provide:
- A copy of our Binding Offer
- Confirmation of the acting solicitor for both customer and lender (if different)
- A copy of a redemption statement from the customer's current lender
- A copy of the Deed of Postponement form from ourselves

Staircasing applications to enable part of the Help to Buy equity loan to be repaid are acceptable for remortgage and further advance applications up to a maximum loan to value of 95%. Staircasing must meet the standard Help to Buy criteria outlined above in addition to the following:

• The minimum permitted staircasing amount is 10% of current valuation. A valuation report instructed by ourselves is required in all instances to confirm the current valuation of the security property.

The following information is required in support of a mortgage application:

• The Society will initially attempt to identify all customers electronically by using software which checks a series of databases for identification information. This search does not affect your client's credit rating, however in some cases we may find it necessary to request paper identification to prove name and/or address. Where required, any documents can be provided using our document upload facility.
• Applicants must supply proof of residence. Any utility bill, council tax bill, bank statements or mortgage statements are acceptable, provided confirmation sight of the original documents is supplied and they are from within the last 3 months.
• The Society will be required to confirm identity. Acceptable documents include a passport or driving licence photocard.
• Intermediaries are responsible for ensuring that applicant's identity and Proof of Residency are verified as part of the application process.
• Applicants must normally have been resident in the United Kingdom for a minimum period of three years. This can be waived for members of the diplomatic corps, a member of HM Forces, or employees of internationally based companies, providing their family will be resident in the property.
• All Applicants (EEA & Non-EEA) who have not resided in the UK for at least 3 years will need to be referred to an underwriter for assessment.
• Non-EEA nationals will require evidence of indefinite leave to remain in the UK.

For more information on the acceptable forms of ID and Residency, please click here

The following sources of income are acceptable:

Primary Taxable Income (100%)

• Basic income
• Private pensions and annuities
• Car allowance
• Pay rise pending (must be within 3 months and employer to confirm)
• Mortgage subsidy (must be permanent)
• Housing allowance
• Additional investment income from rental portfolio (evidenced by accounts / tax assessment / accountants reference)
• London / Large City allowance
• Shift Allowance (Guaranteed)

Primary Non Taxable Income (100%)

• State Pension / Pension Credit
• Guaranteed for Life DWP
• Maintenance Order (CSA / Court Order enforceable)
• Limited Company Director Dividends (net of income tax paid)

Secondary Taxable Income (50%)

• Regular Overtime / Bonus / Commission / Shift allowance
  (2 years P60's will be required to evidence track record)
• 2nd Job with at least 12 months service
• Territorial Armed Forces pay

Secondary Non Taxable income (50%)

• Working family tax credit / Family tax credit / Universal credit (where applicable)

We will accept 50% of:

• 2nd job with 12 months service
• Overtime / bonus / commission / shift allowance

We will not consider:

• Unemployment benefit / income support
• Child benefit
• Housing Benefit
• Social security payments that are not guaranteed for life (DLA etc)
• Seasonal work
• One off payments
• Gratuities not sighted on payslips
• Bursaries and scholarships
• Investment or Trust Income that is not guaranteed

• Where a reduction in income is anticipated in the near future then the impact of this must be considered for affordability purposes. This would normally include applicants who are close to retirement, those that are on or due to go on maternity leave or those that are looking to reduce working hours.
• We would expect that any future changes to income are confirmed on the application we receive so that this can be taken into consideration by our underwriters.
• Where applicants are on or due to go onto paternal leave then we will require details of the date they are expected to return to work, the basis on which they will return (i.e. Part time / Full time) and the new salary on return to work. This will need to be verified by the applicants employer.

For all forms of additional income which is being taken into account, documentary evidence will be required.

LTV limits vary based on the repayment vehicle selected. Documentation requirements also vary based on the repayment vehicle selected as outlined below:

Repayment types that will not be considered are:

• Pure interest only with no repayment vehicle
• Lump sum payments during term other than pension (note we allow this for Large Loans given customer profile earning large bonuses)
• Sale of other assets
• Inheritance

Joint mortgage, sole proprietor applications are acceptable. The scheme essentially allows 1 occupying borrower to be supported by additional income from a family member who will be party to the mortgage but not be named on the title deeds. Loans will be considered on the following basis in addition to standard requirements:

• Available for residential properties only. Not available for BTL applications
• Maximum of 2 borrowers
• Minimum loan amount £25,000 up to a maximum of £1,000,000 (subject to product terms and conditions)
• Maximum LTV 95%
• Affordability will be calculated using combined income from the occupying and non-occupying borrower
• Loans will be available on a repayment basis only
• Additional borrowing for home improvements can be considered, Debt consolidation is not permitted
• Minimum age for the borrower is 18 years
• Maximum age is 80 years at the end of the mortgage term based on the oldest applicant
• A family member is defined as a close family relative, normally a parent or step parent.
• Both applicants must be employed/ self-employed / in receipt of pension income.

The non-occupying borrower should obtain independent legal advice given the nature of the product and joint and several liability for the debt while having no ownership rights over the security property.

In order to obtain an illustration on behalf of your client, please source from either Trigold or Mortgage Brain. Currently the Society is unable to produce an illustration for your client.

Loan to Value (LTV)
Our maximum LTV is set out in the table below:

Income Multiple Caps
Our maximum income multiple is up to 5.75 at underwriters discretion.

Overtime / Bonus / Commission income

We can take up to 100% of frequent payments (Overtime / Bonus / Commission) where:

• Paid Monthly as evidenced on last three months consecutive payslips AND;
• Year to date earnings on payslips must show these payments have been consistent.

We can take 100% of less frequent bonus payments where:

• A two year track record is available via the last two P60s;
• Gross income, including bonus, must be in excess of £100,000.

Repayment options

We can accept Interest Only loans where:

1. Maximum LTV on Interest Only is 75% with maximum of 80% overall (subject to maximum loan size / LTV above);
2. We will accept Sale of Property where Interest Only exposure is capped at 50% LTV and must have a minimum of £150,000 equity on completion. Any additional LTV up to 80% would need to be on capital repayment, we cannot accept any other repayment strategy; and
3. All other acceptable forms of repayment would need to match current lending policy, this includes:
   • Endowment Plan(s) using the midpoint projection
   • Pension Plan(s) where term cannot exceed retirement age
   • PEPS
   • Investments (ISA's / Bond's / Unit Trusts)
   • Share portfolio where current value of portfolio is sufficient to repay loan
   • Regular bonus payments (bonus must be established as part of income verification)
   • Sale of investment property
   • Regular overpayments (either monthly or via periodic lump sum repayments)

More information on our Large Loans lending policy and products can be found on our website at: www.newcastleis.co.uk/large-loans-lending-policy.aspx

Newcastle Building Society has a partnership with the UK's leading conveyancing panel management specialist LMS. LMS provide conveyancing services to the Newcastle supporting the application process for broker customers. Where our products are offered on a fees assisted basis (where a fees assisted legal transfer is included in the features of the product) LMS will provide the conveyancing service. In addition LMS are also able to provide a low cost fee paying service. For details of the costs involved please refer to the fees brochures by clicking here.

Should your client wish to use their own solicitor/conveyancing firm in the purchase or re-mortgage of their home, it is important to note that included in the Society's Panel Acceptance criteria is the requirement for multiple partners. Sole Practioners are not accepted to our panel and any request will be rejected. Where sole practitioners are instructed they may act for your client however we will instruct LMS to act on behalf of the Society. In order to provide this service there will be an additional charge to your client and an outline of these costs can be found on http://www.newcastleis.co.uk/docs/Separate-Representation-England-and-Wales.pdf. If the proposed conveyancing provider is declined a customer can select any other solicitor, including LMS appointed firms from the panel without incurring additional Society fees.

Lending into retirement applies to both those applicants whose mortgage term will take them beyond normal or anticipated retirement age and those who are already retired.

Where applicants are approaching retirement:

• Where the applicant(s) are within 10 years of declared retirement at application and the term requested will take them into retirement then we must be provided with documentary evidence that a pension is in place. Applications will be referred at DIP for an individual review and our underwriters will take account of:
  • Loan amount and LTV
  • Length of term requested and
  • Length of term beyond expected retirement age
  • Plausibility of applicant continuing to earn similar income if working beyond state retirement age dependent on their line of employment
  • Source of retirement income (i.e. state pension / private pension / defined benefit person / defined contribution / investments)
  • Expected level of retirement income and how this is structured

In all instances details of the source and expected income post retirement must be provided at DIP stage

Where Applicants are currently retired:

• Affordability will be assessed solely on post retirement income.

In both instances, the maximum age for borrowers at the end of the loan term is 80. This is assessed on the oldest borrower. We may be able to consider a term beyond the age of 80 for existing borrowers in exceptional circumstances.

Let to Buy is where the borrower is not redeeming the mortgage held on their existing property and is looking to let this out whilst purchasing a new property as their main residence

Loans will be considered on the following basis:

• We obtain consent to let from the existing lender or a copy of the new BTL offer
• We obtain evidence from 1 registered ARLA / NLA letting agent of expected rental income
• The expected rental income passes the NBS rental stress test. This is 145% of the current pay rate
• Where the rent received does not pass the stress test then the shortfall will be taken as a monthly commitment for affordability purposes.

We will consider loans above 80% LTV on referral to an underwriter via Decision in Principle.

We will also consider applicants who are looking to remortgage a property already mortgaged to Newcastle Building Society onto one of our Buy to Let schemes and purchase a new residential property to be mortgaged to ourselves.

• Minimum/maximum loan amounts are product specific.
• Minimum mortgage advance is £10,000 (or £1,000 for further advances), maximum advance is £1m. Loans over £500,000 will require underwriter approval at decision in principle stage.

The Society makes mortgage finance available for:

• The purchase of residential properties for owner occupation, including the purchase of residential properties for a family member to reside in. Normal criteria caps lending at 95% loan to value inclusive of fees.

Remortgages:

• 95% maximum LTV. Can borrow more than owe current lender, subject to the following rules:
  • Home improvements - estimates not required up to 80% LTV. Over 80% LTV - the requirement for estimates is at the discretion of the underwriter.
  • Remortgage fees can be added to the loan if the final LTV does not exceed 95%, product terms permitting.
  • Capital raising is not allowed for business use, currency speculation or to repay gambling debts. The maximum LTV is 80% for all applicants.
  • Where applicants are capital raising for debt consolidation any funds greater than £50,000 will be reviewed by an underwriter at decision in principle. It is expected that as part of the advice process you have fully considered all alternatives to adding unsecured debt to the mortgage.

Minimum repayment term is 5 years (or 3 years for further advances) with a maximum loan term of 40 years.

Please refer to specific product details for maximum LTV

• Max LTV's are product specific and may vary from time to time.
• Remortgages for capital raising purposes including debt consolidation are not permitted on a mortgage above 80% loan to value. Capital raising is described as anything other than the replacement of a home purchase loan or a loan for the purposes of home improvement.

• A New Build property can be classed as i) a property being occupied for the first time in its current state ii) A refurbished property (existing residential unit(s) being occupied for the first time it in current state iii) A converted property (re-development of non-residential unit(s) to residential unit(s) being occupied for the first time in its current state.
• Maximum permitted LTV will be dependent on a) the presence of Builders Incentives and b) whether the property is a new build house or new build flat as follows:-
• The minimum acceptable lease term on new build properties is 125 years for flats and 250 years for houses.
• The maximum starting ground rent on all new build properties with a leasehold tenure is limited to 0.1% of the property value.
• Ground rent must be reasonable at all times during the lease term. For example, ground rent escalation should be linked to RPI (Retail Price Index) or a similar index, and unreasonable multipliers of ground rent will not be permitted, for example doubling every 5, 10 or 15 years.

The maximum loan to value for new build houses is 90%.

Where incentives exist, we allow up to 5% incentives including deposit contributions, cashbacks, legal costs, stamp duty without deductions from the purchase price. Costs that don't have a material impact on the value of the property such as white goods, carpets, curtains are not treated as incentives.

Incentives include builders/developers providing costs for deposit contributions, legal fees and stamp duty but exclude.

The maximum loan to value for new build flats is 85%.

Where incentives exist, we allow up to 5% incentives including deposit contributions, cashbacks, legal costs, stamp duty without deductions from the purchase price. Costs that don't have a material impact on the value of the property such as white goods, carpets, curtains are not treated as incentives.

Incentives include builders/developers providing costs for deposit contributions, legal fees and stamp duty but exclude costs that don't have a material impact on the value of the property such as white goods, carpets, curtains.

• The CML Disclosure of Incentives form that must be completed by the developer and presented to the valuer on site. If this is not seen a nil value is returned on the valuation form.
• For LTV calculation purposes we will accept up to 5% of the purchase price for Builders Incentives
• For clarity, an incentive is defined as any cash or goods received from the builder or developer

All New Build properties must have a home warranty scheme applied. The acceptable schemes to the Society are:

NHBC
Build-Zone
LABC
Zurich Municipal
HAPM
Premier Guarantee
BLP
Protek
AHCI Advantage
ICW (International Construction Warranty)

Please note that we do not accept assignable contracts in any form.

Maximum number of applicants is 2.

Applications will be referred to our underwriters for review in the following circumstances:

• 1 or more pay day loan taken out in the last 6 months
• 2 or more in the last 12 months

Where there is track record of applicants taking pay day loans frequently over the 12 month period then the underwriters reserve the right to decline the application.

Piece workers can be considered where an established track record exists which can be evidenced by receipt of the last 2 years P60s.

If your client has an existing mortgage and wants to borrow more/ port their mortgage to a new property they will need to speak to us directly. They can do this by;

• Calling us on 0345 606 4488 (Lines are open 8am - 8pm Monday to Friday and 9am - 3pm Saturday)
• Visiting their local branch. View our branch finder for details of your nearest branch
• Visit our website

We will consider loans from applicants currently in a probationary period. This is normally subject to a 12 month track record in the same line of work.

For applicants employed within the Police Force will normally have a minimum 2 year probationary period. We will accept loans where the applicant has been employed in role for at least 12 months.

The Society only pays procuration fees for new applications. It does not pay fees for further transactions with existing customers including further advances; porting to a new property; or product switches.

Fees are paid to the Club, Network or Principal within 14 days of completion of the advance.

• For contracted applicants we will require a copy of the applicants current contract and it must have at least 1 year still to run.
• Where applicants are self employed then we require 2 years trading accounts and last 2 years HMRC Tax Assessments and corresponding Tax Overview Forms.
• For applicants who are coming towards the end of their professional career and especially for sportspersons, documentary evidence will be required to establish how they intend to support the mortgage post career.
• There is no restriction on age or term other than normal policy guidelines.

• All properties must have a minimum purchase price or valuation (whichever is lower) of £50,000
• The Society will make advances on any acceptable security in England, Scotland & Wales.
• Properties in Scotland still require a transcript of existing report from the applicant on the proviso that the valuer is on our panel and the transcript is completed on NBS papers. Alternatively, we will instruct our panel valuers.
• The tenure of acceptable properties will be freehold or leasehold in England and Wales, or their Scottish equivalent.
• All properties must be assessed by a suitably qualified valuer with sufficient professional indemnity cover. All valuation instructions (with exception of Scotland) will be made by the Society via our nominated panel. Third party instructions are not acceptable.

We accept applications on a repayment, interest only or part interest only basis.

• We will consider lending 100% of the discounted purchase price as indicated in the offer agreement between tenant(s) and Local Authority / Housing Association.
• We will also consider lending additional funds up to a maximum of 80% LTV of open market value subject to funds being used solely for home improvements.
• It will be a requirement that estimates for the works to be carried out are received prior to us instructing the valuation. We will consider lending up to £5000 maximum upfront to fund immediate home improvements as long as any additional funds are retained until all works completed and a reinspection confirms.
• It will be a condition of the mortgage that any additional funds in excess of the discounted purchase price will still rank higher than the Local Authority's charge on the property.
• Under no circumstances will we lend additional funds for capital raising including payment of fees to any solicitor or third party.
• Only the applicants named on the Right to Buy offer agreement can be named on the mortgage.
• The Society's charge should always be registered as first priority ahead of any Local Authority.
• The valuer must confirm that there is a ready and sustainable demand for the property to be mortgaged. In addition, the valuer should look to confirm that there is at least 50% private ownership within the immediate vicinity.
• Flats will be considered as long as adhere to current policy i.e. no high rise flats, maximum 5 storeys. Note that maximum LTV would be 75% of the open market as per our standard criteria for ex local authority flats.
• Further Advances will be considered subject to all funds must be used for home improvements within the discount period.

Second homes / holiday homes must be strictly for the sole use of the borrower and dependent family members and must not be let. The maximum loan to value for such properties is 75% and the applicant's financial status must be sufficient to cover both loans where we will deduct the applicant's main mortgage as a monthly commitment. Maximum loan is £500,000.

We offer Self Build mortgages exclusively via BuildStore Mortgage Services who can be contacted on 0345 223 4888. Alternatively, visit their website www.buildstore.co.uk for more details. We offer Self Build mortgages on the following basis:

• Where applicants wish to buy land and build a new property
• Where applicants are renovating an existing property
• Where applicants are converting an existing structure for residential purposes

We will consider lending up to a maximum of £600,000 at 85% LTV to purchase land / property and up to 85% of cost of each stage during the build subject to valuation

• Funds are released on an arrears stage payment basis
• Interest Only can be taken during the build but can only be extended beyond build completion where there is a repayment strategy that meets our criteria and LTV does not exceed 75% / 80% part and part
• On completion of the build, following receipt of completion certificate we will allow borrowers to transfer to a standard residential product and waive any Early Repayment Charges applicable.
• It is expected that the build is normally completed within 2 years.

Please contact BuildStore to discuss your client's requirements in full.

• Self Employed applicants must have been trading for a minimum of 3 years to accurately assess track record within chosen line of work. Where applicants do not have 3 years trading it will be at the discretion of the underwriter to approve.
• The income level to be used will be based on the average of last 2 years net profit. Where profits have declined in the last 12 months then we only use the most recent year to assess for affordability. We may also require a projection from the applicant's accountant to ensure that this trend is not continuing.
• Where net profit has declined in consecutive years or drawings continue to exceed net profit then the application will be declined.
• Applicants who have more than a 25% shareholding in a limited company will be classed as self employed for our purposes and 2 years accounts will be required. Income will be assessed by using salary paid and either dividends received or applicants share of net profit. Note that for our affordability model we require the dividends received to be net of any income tax paid. Please obtain this information from applicants SA302's.
• For applicants who have less than 2 years track record as self employed we can offer one of our special self employed products. These are available subject to
Maximum LTV of 75%
At least 1 years full accounts available

• The deposit must come from the applicants' own resources. Gifted deposits from parents and other close family relatives will be allowed subject to there being no repayment vehicle in force and the underwriter being happy with the arrangement. In all instances we will require signed copy of our Gifted Deposit Form which can be downloaded from our useful documents section. This form should be sent with supporting information when you apply for the mortgage.
• Where the source of the deposit is confirmed as 'savings' the Society reserves the right to see documentary evidence of the deposit prior to completion. Crypto currencies such as BitCoin are not considered an acceptable source of deposit.

• "Flying-freehold" - if more than 25% of property involved.
• Houses with rooms let or likely to be let to several tenants where premises have not been converted or constructed for this purpose.
• Properties where the unexpired lease has less than 85 years remaining on completion.
• Unmodernised flats and flats which are above commercial premises. Exceptions can be made for exclusive developments and certain areas of larger British cities where the valuer has confirmed that there is a ready and sustainable demand.
• Studio flats are normally unacceptable but may be considered in prestigious developments where a ready and sustainable demand exists. This is subject to valuers comments.
• Large old unmodernised houses where accommodation is in excess of the applicant's requirements, particularly where there are attics and/or basements.
• Back to back houses.
• Council houses built in a non-traditional way, i.e. prefabricated reinforced concrete.
• Ex Local Authority flats where LTV will exceed 75% (except in Scotland)
• Freehold flats with the exception of 'Tyneside Flat' style or where the application will own a share of the freehold with a management company in place to oversee the maintenance of the building.
• Houses with restrictions to ownership (e.g. retirement flats, restrictions on occupation to local inhabitants). This list is not exhaustive and any application where there is a restriction should be referred to an underwriter.
• Properties with any agricultural restrictions.
• Houses under shared ownership / equity where a sales restriction / charge will remain on the property despite the borrower owning a 100% share.
• Mobile homes or caravans.
• Houseboats.
• Uninsurable properties e.g. due to flood risk.
• Uninhabitable properties (e.g. no kitchen/bathroom/roof/mains services not connected).
• Properties with invasive plants (i.e. Japanese Knotweed) within the immediate curtilage of the property.
• Flats with a Shared Balcony (Deck Access).

Alternative or additional fees may be charged for special schemes, please refer to specific product pages for details.

* All of the above fees include an administration fee to the Society of £112.50.

Please note, for remote properties, further charges may apply for reasonable travel expenses incurred by the valuer in order to carry out an inspection.