Residential policy
Income
Minimum income of £75,000 for a sole application. For a joint application either one applicant to earn £75,000 or joint income £100,000.
To determine the £75k/£100k income levels we include basic pay, pension, benefits and 60% of allowable variable income. Rental income is not included for this purpose.
Maximum LTV and loan size
| Loan size | Maximum LTV | ||
|---|---|---|---|
| Interest only | Part and part | ||
| £80,000 - £1,500,000 | 75% | 85% | |
| £1,500,001 - £2,500,000 | 80% | ||
| £2,500,001 - £5,000,000 | 75% | ||
| £5,000,001 - £10,000,000 | 60% | 60% | |
- Interest only – 75% LTV for loans to £5m, and 60% LTV for loans over £5m. Any amount over these LTV limits can be put on C&I, up to the part & part LTV limit
- Part and part – 85% LTV for loans to £1.5m, 80% for loans to £2.5m, 75% LTV for loans to £5m, and 60% LTV for loans over £5m. No more than 75% LTV can be on interest only
- Example – For a loan of up to £1.5m, up to 75% LTV can be on interest only (all repayment vehicles), and a further 10% LTV can be on C&I, giving a total of 85% LTV
For more information, view our maximum LTV criteria.
Age
Maximum age at the end of the mortgage term 75 and 364 days.
If downsizing is a repayment strategy, no part of the mortgage can extend beyond the customer’s declared retirement age or age 70 and 364 days.
Debt consolidation
Debt consolidation is only allowed on interest only if the debt being consolidated was used for home improvements or repair to the property being mortgaged. Otherwise, the amount being consolidated must be on a capital and interest part of the loan.
Availability
Our usual maximum term of 40 years applies. Standard loan to income multiples apply. Available for remortgage and purchase, including for first time buyers. No minimum property value.
Repayment vehicles
Downsizing
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
Minimum equity at the end of the mortgage £300,000 (current property value minus amount on interest only). For example, a customer taking a loan of £680,000 on a property worth £800,000 (85% LTV) with downsizing as their only repayment vehicle could take up to £500,000 on interest only and £180,000 on capital & interest, as long as the property they were intending on downsizing to costs no more than £300,000.
When downsizing is used, the maximum age at end of the mortgage term is the lower of 70 and 364 days or the customer’s declared retirement age. The term of any Capital & Interest element cannot extend beyond the Interest Only term where downsizing is the proposed repayment strategy.
When submitting a residential interest only application which includes downsizing as a repayment strategy we require details to be provided of the property to be downsized to. We need to know the planned type of property, location and purchase price. If the equity in the property being mortgaged to us does not cover the purchase price of the property being downsized to, you must provide details and evidence of additional repayment strategies.
Sale of the property being mortgaged
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
Other than downsizing, the only other time we allow sale of the mortgaged property is when it’s a second residence. In this scenario we don’t require a minimum amount of equity, but we’ll need to be comfortable that it’s not used as a permanent residence by anyone, and we’d usually want it to be a lower value than the customer’s main residence.
Sale of other property
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
The equity in the other property/properties must be 110% of the amount on interest only, and we’ll carry out automated valuations to verify values.
Pension lump sum
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
The tax free lump sum (25% of the mid-point projected value at retirement) must be 100% of the amount on interest only. The pension must have been in place for at least 12 months.
Investments (like Stocks & Shares, ISAs, Unit Trusts, OEICs)
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
If a projected maturity value is available we can use the mid-point, which must be 100% of the amount on interest only. If a projected maturity value is unavailable we will use the current value, which must be 100% of the amount on interest only. The investments must have been in place for at least 12 months.
FTSE 100 share portfolio
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
The current balance must be 100% of the amount on interest only. A share portfolio must have been held for at least 12 months and the shares must be FTSE 100 across at least 3 different companies.
Cash savings
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest.
The current balance must be 100% of the amount on interest only, and have been held for at least 12 months.
Endowments
Maximum 75% LTV. The total LTV can be topped up to 85% using capital and interest. The mid-point projected maturity value must be 100% of the amount on interest only. The endowment must have been in place for at least 12 months and the maturity date must be on or before the end of the mortgage term.
Other repayment vehicles
We will consider alternative repayment strategies to those listed above on a case by case basis. However, we are unable to accept the following: Converting to C&I in the future, overpayments, bonus, increasing house prices, inheritance, sale of a business.
All repayment vehicles must be held in the UK in sterling, and there must be no additional owners of repayment vehicles being used who are not party to the mortgage.