A Selection of Buy To Let Mortgages Criteria

Buy To Let Mortgages Criteria 1

Minimum age: 18

Maximum age: 75 years at the end of mortgage term

Definition of confirmed income

100% of basic salary, mortgage subsidy, cost of living allowance, housing or rent allowance, service/state pensions and car allowance.

We also consider up to 60% of regular or non-guaranteed overtime, bonus and commission. Exclusions - travel allowance and expenses.

A minimum income per application of £10,000 per annum is required.

Minimum employment period

Employed applicants will be expected to have been employed for a minimum of 3 months in their current role (12 months continuous employment).

Self-employed applicants would normally be expected to have been self-employed for a minimum of 12 months.

Documentation required

All first time buyers: 3 months' bank statements and P60 plus last 3 payslips or latest 2 year's accounts to be provided.

All existing mortgage holders/local authority tenants: Latest lender's or landlord's statement. A copy of the Assured Shorthold Tenancy Agreement may be required for further advance applications.

Properties being remortaged to the lender: Evidence of last 12 months mortgage payments. Each case is considered on an individual basis. We may request additional information where considered appropriate and relevant to the lending decision. Property details

Household insurance: Property will only form an acceptable security if insurance cover, under normal terms including subsidence and flood cover is confirmed.

Conveyancers: Must be on the lenders panel of conveyancers and will also be instructed to act on behalf of the lender.

Security: First mortgage on freehold properties in England, Wales and Northern Ireland, feudal properties in Scotland or leasehold properties in England, Wales and Northern Ireland with at least 70 years remaining on the lease at the time of application. If a flat is part of a conversion where the total number of flats in the scheme is above 8, the valuer must confirm that the whole conversion project has been or will be completed to a high standard. Freehold flats/maisonettes are unacceptable. Residential security only. We require that a newly built property (or one being occupied for the first time) has the benefit of a 10 year warranty from the National House Building Council (NHBC) or Zurich Municipal Insurance. The Zurich warranty may be extended to 15 years. The exception to NHBC or Zurich Municipal cover is where an architect or qualified surveyor is employed by the applicant to supervise the building of the property (certain other qualified consultants may be acceptable - please refer).

Loan details

Minimum loan: £25,001 (house purchases and remortgage)

Maximum loan: £1million

Term: 5-40 years

LTVs purchase and remortgage: 85% £25,001 to £1million. Certain Buy to Let products have a lower max LTV. Where a product with a lower LTV is combined with a product with a higher LTV the lower LTV will apply to the whole loan.

Additions to loan: The items that can be added on to the loan amount are higher lending charge (where payable) and arrangement fee. The maximum loan including add-ons as a percentage of purchase price or valuation (whichever is lower) must not be more than 89%.

Additional Borrowing: When applying for additional borrowing the product chosen must be from the same scheme (eg. Buy to Let) as the main advance; the minimum additional borrowing is £1,000. For capital raising of £25,001 or more, and for home improvement loans of £15,001 or more, a product from the full product range can be selected (please note a flexible product cannot be combined with any other product type). Restricted rates apply for loans below these amounts.

Free Remortgage Service (where applicable): The Free Remortgage Service is available on all properties in the UK, using the lenders designated remortgage service. An additional charge will be made for any non-standard legal work including deeds of postponement, transfers of equity and registering of title. Any additional charges will be advised to the borrower prior to the work being carried out. Please note remortgage products offering the Remortgage Service and other incentives must be taken as a complete product.

Repayment methods: Capital and interest, interest only or combination. The method(s) for repaying interest only element must be specified.

Monthly payments: All payments must be made in sterling by direct debit through the UK direct debit system. The direct debit must be in place prior to completion.

Portability: All products are portable which means that you can keep the same rate and terms of your chosen mortgage if you move during the product period.

Deposits: The deposit for any purchase should come from the applicant(s) own resources. However, a builder's deposit up to a maximum of 5% of the purchase price is allowable on applications where the LTV does not exceed 85%. Where there is a purchase at undervalue, the maximum loan will be based on the discounted purchase price. The valuer must be aware of any incentive and refer to this in the valuation report.

Interest: Interest calculated on a daily basis.

Buy to Let specific criteria: A limit of £5 million applies to Buy to Let lending.
Maximum lending on each individual Buy to Let property of £1 million.
Confirmation of anticipated rental income will be provided by the valuer as part of the valuation.
Minimum acceptable property value or purchase price (whichever is the lower) is £40,000 (£75,000 in London postal districts).
The property may be let on an assured shorthold tenancy or to a company on a corporate let.
The maximum term is 12 months.
Our consent is not required to renew the tenancy.
Where the property is not to be let immediately, or the borrower is a first time buyer, the loan will be calculated on earned income, 3.25 + 1 or 2.75 joint incomes. All other criteria must be met.
Houses in multiple occupation lets are not acceptable. Maximum 3 tenants allowed (where there are 3 tenants there must be a close family relationship). Student lets, holiday lets and tenants claiming housing benefit, rent rebate or rent allowance are not acceptable.
If the property is in Scotland the landlord must register with the relevant Local Authority.

Buy To Let Mortgages Criteria 2
Buy To Let Mortgages Criteria 3
Buy To Let Mortgages Criteria 4
Buy To Let Mortgages Criteria 5