Residential policy
Employed
Guaranteed income
In addition to basic pay from permanent employment, we accept 100% of any contractually guaranteed income, like a car allowance or territorial allowance.
Variable income
View our bonus and variable income policy.
Probation
If the customer is in probation or has not been in their current job for 6 months, this is acceptable as long as they have a permanent contract (as opposed to short term) and they’ve received their first payslip.
Second jobs
We take 100% of income from a second job where the income has been received for at least 12 months.
Parental leave
When someone is on parental leave (often maternity leave or paternity leave), we’ll use their return to work income subject to confirming their intended return to work income and date, which should be in the next 12 months.
We’ll need to know how they’ll afford their commitments until they return-to-work (employee benefits, statutory pay, partner’s income, savings, for example).
Any future childcare costs should be included within the application.
Other employed income
Agency, fixed term employment and zero-hours contracts are usually acceptable where the customer has a 2-year track record in the same line of work. For zero-hours contracts we usually need a 2-year track record of that income type. For fixed term contracts we usually need 12 months remaining on the contract. Scenarios can vary so it’s best to get in touch before applying.
Seasonal or temporary short term employment is not acceptable.
Self employed
Shareholding
If the total combined shareholding of all applicants is under 25% of a limited company, we treat them as employed. If it’s 25% or more, we treat them as self employed.
LLPs
If a partner/member of an LLP is salaried with no shareholding, we treat them as employed. If they are an equity partner or receive profit share as part of their remuneration, we usually treat them as self employed.
View our self employed policy
Contractors
- View our contractor policy
- Construction Industry Scheme (CIS) income is assessed using our self employed policy
Pension
- If a customer is already retired, or the term extends to or beyond their declared retirement age or 71st birthday and they are within 10 years of either date we will use their pension income for affordability, or current income if lower
- If the term extends to or beyond the customer’s declared retirement age or their 71st birthday but the customer is not within 10 years of either date, we don’t need proof of income in retirement, but we do need to see that the customer is paying in to a pension plan
- For self employed customers we may be able to use their current income up to age 75 and 364 days. This is subject to their line of work and business activities. Please check with us before applying
- The following types of pension are all acceptable: annuities, occupational (defined benefits / final salary, defined contribution / money purchase), pension tax credits, personal (stakeholder, SIPP), state, war, war disability
Maintenance
Income from a court ordered maintenance agreement or a Child Maintenance Arrangement is usually accepted if there’s a track record of it having been received and it’s sustainable. Please get in touch to see if we could help.
Benefits and disability benefits
We accept the following benefits: Adult Disability Payment, Carer’s Allowance, Child Benefit*, Child Disability Payment, Child Tax Credits, Disability Living Allowance, Disabled Person Tax Credits, Employment and Support Allowance, Incapacity Benefit, Independent Living Fund, Personal Independence Payment (PIP), Reduced Earnings Allowance, Universal Credit**, War Disablement Pension & Working & Family Tax Credit.
*Where either applicant’s total gross income is above £60,000 child benefit must not be included as a source of income.
**At least one applicant must be in receipt of earned income. Any Housing Benefit shown on the Universal Credit Award Letter should be deducted from the income.
Rental income
- On a residential application, we assess any background rental income and expenditure, including established BTLs and properties about to be let
Other
- Other income such as income from investments, trusts, non-court ordered maintenance or income protection insurance/PHI can also be considered but please check with us before applying
- We don’t accept any foreign currency income