Residential Lending Policy
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We offer mortgages to various people in various situations. Residential mortgages are available for the following purposes:
- Purchases of a residential property
- Remortgages of an existing secured loan
- Self Build mortgages (exclusively through BuildStore Financial Services)
- Capital raising
- Additional borrowing and product transfers for existing customers
All our mortgages are provided subject to status. This means that when you request a mortgage or a remortgage quote from us we will take into account your circumstances, both personal and financial, to make sure you could borrow the maximum mortgage that suits your lifestyle and your budget. We will also consider the amount you want to borrow and the value of your home. Our decision to provide you with the best mortgage rate will depend on these factors along with any criteria specific to the mortgage product you have chosen.
The Society no longer assesses your borrowing capacity through income multiples and has developed a new Affordability Calculator which is now more tailored to your individual circumstances.
Assessment of how much you can borrow is now calculated through a combination of your income, regular commitments and household / lifestyle expenditure.
In assessing affordability all unsecured loans have more than 6 months to run, credit cards and maintenance will be deducted. In addition, deductions will also be made for declared household and lifestyle expenditure which is compared against statistical data for accuracy.
To see how much you could borrow please visit your local branch or contact our Newcastle Direct Team on 0845 6064488 where one of our experienced mortgage advisors will be able to assist.
To ensure that your assessment is as accurate as possible please can you provide our advisors with as much information regarding your personal income and expenditure. Information on monthly expenditure such as council tax, utility bills, insurances and loans / credit cards commitments will need to be provided.
Standard Maximum Advance
The maximum loan we will advance is as follows:
- For home purchase and remortgage, 95% of the price or valuation of the property, whichever is the lower. Please refer to specific product details for maximum LTV. There is also a restriction on loans greater than £350,000.
- Re-mortgages for capital raising purposes are restricted to 80% LTV.
- 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 applicants financial status must be sufficient to cover both loans (i.e. mortgage on first property plus new mortgage).
- Guarantors are acceptable to the Society subject to a maximum LTV of 95%. Applicants generally need to be able to support mortgage payments but we will consider applications where affordability is split between applicant and guarantor. The guarantor must be a close family relative (parent, child, grandparent) and needs to be fully aware of their commitment and potential liability. It is a requirement that Guarantors take independent legal advice.
- We only accept applications on a repayment basis only. Loans on an interest only or part interest only basis do not meet our lending criteria.
Purchase Price Valuation
All properties must have a minimum purchase price and / or valuation (whichever is lower) of £40,000.
Alternative fees will be charged for special schemes, please refer to specific product pages for details.
|Valuation of Property *
||Standard Fee *
||Homebuyers Fee *
||Structural Fee *
|Up to £100,000
|£100,001 - £200,000
|£200,001 - £250,000
|£250,001 - £300,000
|£300,001 - £400,000
|£400,001 - £500,000
|£500,001 - £600,000
|£600,001 - £700,000
|£700,001 - £800,000
|£800,001 - £900,000
|£900,001 - £950,000
|£950,001 - £1,000,000
* All of the above fees include an administration fee to the Society of £125.00.
Minimum age for applicants is 18. Maximum age at the end of the loan term is 75 although we will consider applications beyond this where borrowers can evidence income to support in the long term.
Where applicants are within 5 years of expected retirement age and the term required takes them into retirement then
sufficient post retirement income to support the advance throughout the mortgage is required.
The following points will be taken into account when considering the applicants' ability to meet mortgage payments.
- Employed applicants must either have been with their present employer for at least six consecutive months or, if less than 6 months, with a previous employer for at least eighteen consecutive months.
- Exceptions may be made for certain professionally qualified applicants who have only recently taken up employment.
- 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.
- Overtime / bonus / commission must be a regular component of earnings and 50% of such earnings will be taken into account.
- We will consider 100% of unencumbered unearned income, including investment and rental sources. Pensions are an acceptable form of income, if guaranteed. All cases must be referred in the first instance.
- 50% of Income from a second job will be considered provided that there is a minimum of 12 months service. (we will accept 100% of income where 2 part time jobs is full time equivalent).
- 100% of maintenance payments will be considered subject to a court order or CSA. All cases must be referred in the first instance.
- Our criteria for non-standard income, as listed above, applies to all applications, irrespective of the loan required.
- 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 international based companies, providing their family will be resident in the property.
- Non-EEA nationals will be restricted to 75% LTV although a higher LTV may be considered on referral to an underwriter. In all instances we will require evidence of indefinite leave to remain in the UK. Professional applicants on long term visa's with at least two years remaining will also be considered.
All existing NBS borrowers will be referred to underwriters for assessment.
The following information is normally required in support of a mortgage application:
- For employed applicants, last three months' pay slips and most recent P60. Satisfactory references covering the last two years may also be sought.
- For self employed applicants, the last two years' audited/certified accounts plus a projection for the current financial year. Accounts must be audited / certified by a chartered or certified qualified accountant.
- Proof of payment for the preceding 12 months is required where the applicant has had a previous mortgage or has been a tenant and the data is not available via a credit check.
- For all forms of additional income which is being taken into account, documentary evidence will be required.
- In the event that the applicants are not registered on the electoral roll, they must supply proof of residence. Any utility bill, council tax bill, voters roll enquiries, bank statements or mortgage statements are acceptable, provided the original documents are supplied.
- The Society will be required to confirm identity. Acceptable documents include a, passport or driving licence or a recent bank statement.
Interest Rates, Fees and Charges
The Society's general mortgage administration fees are detailed in our Summary of fees and charges, a copy of which is available upon request.
An administration fee of £299.00 will apply for the application of a further advance.
- All the above terms & conditions apply to residential "lending only".
- The Society reserves the right to reject any application where the borrower has any convictions or pending prosecutions relation to financial misdemeanour or dishonesty.
- These guidelines outline the main elements of the Society's residential lending policy, but are by no means exhaustive.
- In the interests of security, we may from time to time record telephone calls to and from us.
- For clarification of any aspect of our policy, or a full written quotation, please contact your local branch or our Newcastle Direct teem on 0845 606 4488.
- A first charge will be required as security. All mortgages are subject to status and valuation. APRs are typical and variable.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE