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Application 

 Applicants

A maximum of 4 applicants are allowed on one application.

Important information on keying/amending of applicant details

Once you've started keying an application if you wish to change the order of the applicants or add/remove an applicant, it is extremely important that you do not just amend one customer details to another customer. Please follow the steps below to ensure the data is correctly allocated to the right customer:

To change the applicant order:

  • In the Applicant Summary table at the bottom of the Personal Details screen use the ↓ and ↑ arrows on the left hand side to amend the order.
  • Click 'Submit' button.

To remove an applicant:

  • In the Applicant Summary table at the bottom of the Personal Details screen use the 'Delete' button on the right hand side to remove an applicant.
  • Click 'Submit' button.

To add an applicant:

  • Click 'Add Another Applicant' button on Personal Details screen.
  • Complete new applicant details.
  • Click 'Save Applicant'.
  • Click 'Submit' button.

Under no circumstances should you be changing information keyed in name, date of birth or other personal details fields from one individual to another.

If you have any queries please speak to your Business Development Manager before making any changes to an application.

Additional Information: First Time Buyer / First Time Landlord


 Decision in principle

Our mortgage promise provides a credit score facility using minimal information. It states how much we can lend and is valid for three months subject to a valuation and the information supplied being correct.


 Direct Debit details

The details of the customers bank account from where the mortgage will be paid should be keyed at application. The account must be in the customers personal names, business accounts are not acceptable. There is no requirement to complete a Direct Debit mandate form, but details must be provided before the offer will be issued.


 Documentation Required

All proof of income, deposit, gross monthly rent and identification must be obtained before application.

A tenancy agreement or letter from the letting agent can be used to verify the rental income keyed in the Property Schedule screen of the application.

Additional Information:
Acceptable documents
Income types
Rental Income
Self-employed applicants
Pension income
Deposits
Self-employed/Contractors


 Finders Fees

Applications involving finder's fees are not acceptable. A finder's fee is a fee or commission paid by a seller to a third party (such as an investment club) for finding or introducing a buyer. It does not include the normal fee or commission payable to any estate agent handling the sale.


 First Monthly Payment

The first monthly payment is always collected in the month following completion, for example if a mortgage completes in June the first payment will be collected in July.

This will be collected on the customer's chosen monthly payment date unless completion occurs in the last few days of any month and results in less than 4 working days between the completion date and the customer's chosen payment date (excluding those days), the first payment will then be collected on the 10th of that month.

This date will then revert to the customer's chosen payment date on the following month. The first monthly payment includes an amount of 'Initial Interest' from the day of completion to the end of that month plus the first monthly mortgage payment. For example: If completion occurs on the 15th, interest is calculated from the 15th to the end of the month and then added to the first payment.

If completion occurs on the 5th, interest is calculated from the 5th to the end of the month and then added to the first payment. The 'Amount of each instalment' section of the mortgage illustration sets out a first payment assuming a mortgage completes on the 1st of the following month.

A customer's first monthly payment may be different as it will depend on when the loan starts. We write to all customers when the mortgage starts to tell them when we will collect their first and subsequent payments.


 Free Conveyancing

The remortgage service is available on most, but not all, of our remortgage products. Where your customer uses our remortgage service, we will pay our conveyancer's legal fees and any registration fees.

Your customer will have to pay any fees their existing lender may charge in connection with repaying their current mortgage.

These include your customers existing lender's conveyancer's fees if the existing lender does not allow our conveyancer to act for them too.

Additional costs may also be incurred for but not limited to:

  • Transfer of Equity
  • Purchasing an additional tranche
  • Additional TTs where a cashback is involved
  • Second Charges
  • Possessory title
  • Unregistered land
  • Leasehold properties

IMPORTANT - Northern Irish law states that solicitors appointed by the Lender are not able to provide any additional services to the customer. Therefore, should the customer/s require any additional services they should instruct another firm to complete these services on their behalf.

Your customer can choose their own conveyancer to act. Please note also that our remortgage service is not available with some of our remortgage products and your customer will have to choose their own conveyancer to act if they decide to have one of these products. This conveyancer will act for BM Solutions in the remortgage, provided they are on our panel of conveyancers, and your customer must pay the legal charges, and any search fees, registration fees or other costs, whether or not the matter goes ahead. The search insurance facility will not be available.

The remortgage service is also available for customers who are capital-raising on a mortgage-free property.

Scottish Properties - Closure of Sasine register

As part of the goal to complete the Land Register, the General Register of Sasine closed to standard securities on 1 April 2016. This change only affects remortgaging of Scottish properties that are on the old Sasine register.

As part of our commitment to make things easier BM Solutions will cover the standard costs for transferring from the Sasine register to the Land Registry within the conveyancing element of our remortgage service, wherever possible.

However, some transactions are deemed to have an additional level of complexity where we won't be able to cover the full costs as part of the remortgage service. For these complex cases the conveyancer should discuss the case with the customer to establish the level of additional fee required, which is then payable by the customer. The Scottish Conveyancing panel has estimated it expects approximately 40% of cases to be complex.

Some examples of where the conveyancer would classify the transfer of the property tile from the Sasines Register to the Land Registry case as complex include:

  • Plans report states either an overlap or shortfall between the legal and occupational extent
  • Title is complex with split-off writs, exceptions and additions (essentially requires a full examination of title to draft the security and obtain a relevant deed plan)
  • Property is a flat or part of a tenement block and there are common parts etc, obtaining of neighbouring titles would be required
  • Property is rural and copies of neighbouring titles are required to check servitudes/access rights etc.
  • These are some high level examples considered by conveyancer panel firms as most likely to occur (but are not limited to these examples). The specific costs associated to complex cases/scenarios will vary, and panel firms will apply an hourly rate and discuss all matters with customers up front prior to commencing any further with the transaction.

 Proof of Residential Purchase – Let to Buy

All Let to Buy applications must involve a related residential purchase. We will only accept applications where customers are renting out their current residential home to enable them to buy another.

The following evidence is required:

  • A copy of the customer's mortgage offer on the property being purchased.
  • If no mortgage is being taken on the new residential purchase or the residential mortgage lender is unable to issue their offer, the conveyancer must provide a letter to confirm the property is being purchased mortgage free or with a mortgage, the future residential address and the purchase price.
  • The Conveyancers letter must be addressed to BM Solutions and dated no older than 3 months from the time of application.

This evidence must be provided before the Let to Buy offer can be issued, and this also meets our requirements to obtain details of the customer's future residential address.


Customer 

 ID & Address Verification

All customers must be fully and appropriately identified as part of the mortgage application process.

Sufficient and accurate information must be recorded on our application system, including confirmation of whether this is a face to face or non face to face application.

If the customer does not pass our electronic verification checks you will need to certify and retain evidence of the customer’s identification documents.

The documents that can be accepted differ depending on whether you have met with the customer face to face in person, or via a non face to face method, for example telephone and video interviews. Please refer to the acceptable documentation below.

FCA registered firms must ensure that documentation relied upon to verify aspects of a customer's identify is copied, certified and retained on file in accordance with Money Laundering Regulations. We reserve the right to contact you and request copies of identity documents at any time during the life of the mortgage and for up to 5 years after cessation.

Acceptable Documentation

Single ID&V

For face-to-face verification (where the customer is physically present when documentation is taken and verified), one document from the Single Identification list can be used to verify the customer.

Single ID cannot be used if the customer is not present when ID&V is collected, including video interviews. See Standard ID&V for further guidance.

Single ID&V Documents

  • UK Photo Card Driving Licence*
  • UK Passport
  • Some EU/EEA Identity Cards
  • Some Non-UK Passports.

The above documents can be accepted in a former name, providing the appropriate evidence of the name change has also been evidenced. i.e. Marriage certificate, Deed Poll, Decree Absolute.

*The address on the driving licence must be the customer’s current address

Standard ID&V

Standard ID&V must be followed when:

  • The customer is not present when ID&V is obtained, or
  • The customer does not hold a single ID document.

The customer will need to produce two separate documents. Documents must be originals and can only be used once throughout the whole process; i.e. used once for either address verification or for identification.

Standard ID&V Documents

Identification

Address

UK Passport

Yes

No

UK Photocard Driving Licence (displaying the customer’s current address)

Yes

Yes

Non UK Passports

Yes

No

EU/EEA Identity Cards

Yes

No

Biometric Residence Permit

Yes

No

EU/EEA Photo Card Driving Licence

Yes

Yes

UK Paper Full Driving Licence (issued up to 30th June 1998)

Yes

Yes

UK Benefits/State Pension notification letter – dated within last 12 months

Yes

Yes

HMRC Correspondence (excluding P45/P60) – must show Tax reference or NI number – dated within last 12 months

Yes

Yes

Bank, Building Society or Credit Union Statement - Dated within last 6 months and issued by a regulated financial sector firm in the UK

No

Yes

Mortgage Statement from a Bank or Building Society – Dated within last 12 months and issued by a regulated financial sector firm in the UK

No

Yes

Council Tax Correspondence (excluding arrears and reminders) – Dated within last 12 months

No

Yes

Utility Bills – Dated within last 6 months

No

Yes

Solicitor’s correspondence – relating to house purchase and dated within last 3 months

No

Yes


 Expatriates

We do not currently accept new business applications from ExPat residents.


 Foreign nationals

Applicants who are non-UK/non-Irish nationals and have less than five years continuous residence in the UK must provide evidence of permanent right to reside.

Acceptable evidence is as follows:

  • 'Share code' for EEA / Swiss nationals with Settled or Pre settled status. We will use this to confirm status.
  • Non-UK passport with indefinite leave to remain/Right of Abode UK Residency stamp in the passport.
  • Biometric Residence Permit.
  • Home Office documentation confirming indefinite leave to remain in the UK.

Additional Information: Refugees


 How to Certify a Document

Only identification & address verification, and right to reside documents are required to be certified.

You must certify the documents at the time they are collected and retain the copies on file, you do not need to upload copies to the application unless requested by us.

Certifying documents

Documents should be certified by an FCA registered mortgage intermediary. Certification on the document should include:

  • Name of the certifier
  • Job title of the certifier
  • Signature of the certifier
  • Date of certification, which must not be older than 3 months at the time of the application
  • Written confirmation from the certifier stating, "I hereby certify that this is a true and correct copy of the original document as sighted by me" (variations are acceptable).

Separate ‘certificates’ are acceptable (sometimes called ID Verification Header Sheets, Broker/Adviser Verification Checklists or similar).

  • Details on the certificate must match those of the ID&V documents provided.
  • Wording to confirm true & correct copies of documents should be included (variations are acceptable).
  • The intermediary name and signature must be included on the certificate/document and the date must not be older than 3 months at the time of the application.

 Refugees

Refugees/Asylum Seekers must have indefinite leave to remain, which must be verified by the documentation from the Immigration and Nationality Directorate. This will consist of a letter confirming that they have been granted "Indefinite Leave to Remain".

A Refugee/Asylum Seeker may have been granted one of the following but these are all unacceptable for mortgage purposes:

  • Exceptional Leave to remain in the UK
  • Humanitarian Protection
  • Discretionary Leave

Income 

 Affordability and Sustainability

Affordability is assessed using the anticipated rental income from the property. In addition to rental coverage, we'll assess personal income when making a lending decision. It's therefore important that the customer’s income is keyed accurately as it may affect the decision.

We expect to see that the applicant can afford their personal commitments so we can be confident that the lending remains sustainable in the event of tenant voids or maintenance and repair costs incurred. An application may be declined where we determine that there is insufficient disposable income to support the borrowing and the customer's personal commitments.

Our rental cover calculation provides for an excess of rent compared to the actual mortgage payment to enable the landlord to cover such eventualities. However if the personal affordability is stretched this may not leave them with the capacity to retain such savings.

We will also take into consideration the additional cost of an increased tax liability for some customers as a result of the change in tax legislation. The legislation was fully implemented in April 2020 and as a responsible lender we must consider future sustainability.

We understand that the personal income may not reflect the overall financial picture for the applicant and they may have other assets and savings available. We also understand that the BTL may be in a single name whilst personal financial commitments may be held jointly with another party.

Useful information which we may require where the application is subject to manual underwriting includes:

  • How the customer maintains their commitments
  • How they've built up any reserves, including the deposit
  • Whether they have previous experience of Buying to Let
  • Rationale for sole applications where finances are joint
  • Information about the business for Self Employed customers

Additional Information:
Tax on Rental Income
Income Types


 Applicants Not Paid in Sterling

Foreign currency income will not be accepted for new mortgage or remortgage applications for new and existing customers, including porting, transfers of mortgaged property (TOMP), and further advances.

The only exceptions to this are further advance applications for essential repairs to the mortgaged property and product transfers.

Foreign currency income is any income other than sterling received by a customer. Foreign currency income paid into a UK bank account and subsequently transferred to sterling is still considered to be foreign currency.


 Contractors

If your applicant is classed as employed, then they will be expected to meet the minimum 3 month requirement in their current role.

If your applicant is classed as Self Employed then we will require at least 2 years' worth of trading figures.

Sub Contractors, Fixed/short term contracts and Agency workers

Applications will be considered from the above employment types if the customer has a current continuous employment of 12 months or more with 6 months of the contract remaining or the customer has 2 years continuous service in the same type of employment. Evidence of their employment track record may be required.

IT and other contractors

For IT contractors on any income and other contractors whose income is more than £500 per day or £75,000 per annum: whether employed or self employed, we accept the gross value of the contract as evidence of income. All applicants must have a current continuous employment of 12 months or more with 6 months of the contract remaining or 2 years continuous service in the same type of employment.

The customer should be treated as self employed if they have more than one contract, or where they have set up a limited company and employ other contractors.

Construction Industry Scheme Contractors (CIS)

Applications from customers employed on a Construction Industry Scheme (CIS) Contract will be considered. An average of the latest 3 months income should be used and evidence of the income for these applicants must be provided.

Customers should be treated as self employed if they pay their own tax or sub contract to more than one company.

Zero hours contracts

Applications from customers employed on a zero hours contract will be considered. The total of the last 12 calendar months income only will be used and all the income must be evidenced.

Professional Sports People

Applications will be considered from Professional Sports People where either continuous employment of 12 months or more with 6 months of the contract remaining or 2 years continuous service (for the last two years as at the date of application) in the same type of employment can be confirmed. It is essential to establish that such individuals will have the ability to sustainably meet the monthly repayments as they near the end of their career or if their career should be ended abruptly due to injury.

Additional Information:
Length of employment/self-employment
Income Types
Self-employed applicants


 Income Types

  • For all applications, at least one of the applicants needs to be in receipt of earned income and/or pension income but Income from all sources will need to be captured and recorded accurately. This includes all full years of Self Employed income, PAYE, Pension and Gross Monthly Rental Income for all BTL / LTB properties.
  • There is no minimum income requirement.
  • Customers should be registered for UK tax and the source of income should be within the UK
  • Any residential mortgages must be adequately covered by your client's current income
  • Payslips must show the applicant and employer name, pay date, basic income, gross & net pay and any additional payments being used in affordability
  • We are prepared to request an employer's reference where the customer is unable to provide our preferred documentation. This does not apply where the customer is employed in a family business
  • Hand written payslips are acceptable, but only where the corresponding bank statements are also provided to confirm the income paid by the employer
  • Bank statements must show the customer's full name or initial and surname and account number
  • Internet bank statements must show bank heading/name and http address
Income Type Acceptable? Main or Other Key as Evidence
Additional Duty Hours (including Additional Responsibility Hours) Yes Other Additional Duty Hours Latest 3 months payslips
Adoption Allowance No
Airbnb No
Area Allowance Yes Other Town / Area / Car Allowance Latest months payslip(s)
AFC Absence Yes Other Shift Allowance Latest 3 months payslips
Armed Forces Independence Payments (AFIP) Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Attendance Allowance (State Benefit) Yes Other Attendance Allowance Latest Bank Statement or Benefit Award Letter
Attendance Allowance (Turning Up To Work) No
Bank Holiday Pay (only if it forms part of basic pay and doesn't inflate income) Yes Main Basic Annual Income Latest months payslips
Basic Salary (including the probationary period of a permanent contract) Yes Main Basic Annual Income Latest months payslips
Bereavement Allowance (previously Widows Pension. If State Widows Pension, please see below). No
Bonus (These must not be keyed unless they have actually been paid) Yes Main Annual Guaranteed Bonus Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)
Bounty Payment No
Bursary No
Call Out Yes Other Additional Duty Hours Latest 3 months payslips
Car Allowance inc. Car Trade Down. Yes Other Town / Area / Car Allowance Latest months payslips
Carers Allowance Yes Other Carers Allowance Latest Bank Statement or Benefit Award Letter
Cash In Hand Yes Main Basic Annual Income Latest months payslip(s) and Bank Statement
CEA (Doctors Excellence Award) Yes Main Basic Annual Income Latest months payslips
Child Benefit Yes Other Child Benefit Latest Bank statement or Benefit Award Letter
Child Tax Credit Yes Other Child Tax Credit Latest Bank statement or Benefit Award Letter
Commission Yes Main Annual Regular / Guaranteed Commission Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)
Competency Related Threshold Payment Yes Main Annual Guaranteed Bonus Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)
Constant Attendance Allowance Yes Other Constant Attendance Allowance Latest Bank Statement or Benefit Award Letter
Continual Professional Development (CPD) Yes Other Additional Duty Hours Latest 3 months payslips
Council Tax Benefit No
Country Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Danger Allowance Yes Main Annual Regular Overtime Latest 3 months payslips
Delivery Supplement Yes Main Basic Annual Income Latest months payslips
Disability Living Allowance - not acceptable if received for a 3rd party e.g. dependent Yes Other Disability Living Latest Bank Statement or Benefit Award Letter
Dividends - Investment Linked No
Dividends - For Company Director Yes Main Self Employed See Limited Company Director/Shareholder under Self Employed/Contractors section
Employed in a Family Business: If less than 25% invested interest and does not receive dividends or net profit as part of their reward package (Treat as employed) Yes Main Basic Annual Income Latest months payslip(s), and corresponding bank statement(s)
Employment & Support Allowance (ESA) Yes Other Employment and Support Allowance Latest Bank Statement or Benefit Award Letter
NHS Enhanced Pay /Enhancements (EN) or (ENH) Yes Other Shift Allowance Last 3 consecutive payslips
Examiners Payroll Yes Other Additional Duty Hours Latest 3 months payslips
Expenses No
Fire Warden Allowance Yes Other Additional Duty Hours Latest 3 months payslips
First Aid Allowance No
FIT Payment No
Fixed Annuity Payments (Private) Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Flexible Benefit (We accept 100% of benefit) Yes Other Colleague Flexible Benefit Latest 3 months payslips
Flight Attendant Allowance Yes Other Flight Pay / Allowance Latest 3 months payslips
Footwear Allowance No
Forklift Premium Yes Other Additional Duty Hours Latest 3 months payslips
Foster Care Income Yes Main Self-Employed Latest 2 years tax assessments
Gambling No
Get You Home Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Guardian Allowance No
Healthcare Allowance No
HDT Allowance (Home to Duty Travel) Yes Other Additional Duty Hours Latest 3 months payslips
High Cost Area Yes Other Town / Area / Car Allowance Latest months payslips
HM Forces - Guaranteed Income Payment (GIP) Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Holiday Pay (only if it forms part of basic pay and doesn't inflate income) Yes Main Basic Annual Income Latest months payslips
Housing Allowance (where paid by employer only) Yes Other Town / Area / Car Allowance Latest months payslips
Housing Benefit No
Income Support No
Industrial Injuries Disablement Benefit Yes Other Industrial Injuries Disablement Benefit Latest Bank Statement or Benefit Award Letter
Insurance Payout No
Investment Income (Unless applicant already retired - see Pension Schemes for details) No
Key Holder Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Leave of Absence Yes Main Basic Annual Income Latest months payslips
Living Wage Allowance Yes Main Basic Annual Income Latest months payslips
Lodgers Income No
London Weighting Yes Other Town / Area / Car Allowance Latest months payslips
Long Separation Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Long Service Pay Yes Main Basic Annual Income Latest months payslips
Long Term Sick No
Lottery No
Lunch Allowance No
Maintenance Yes Other Maintenance Latest 3 months Bank statements Court Order or Maintenance Assessment or letter from Child Support Agency (CSA)
Market Supplement Yes Main Basic Annual Income Latest months payslips
Maternity Pay – providing the applicant will return to work on the same terms. Yes Main Basic Annual Income Latest months payslip(s) received prior to commencement of maternity
Medical Negligence Annuity Payments No
Military Reservist Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Mortgage Subsidy Yes Other Mortgage Subsidy Latest 3 months payslips
NHS Banding Yes Main Basic Annual Income Latest months payslips
Non Consol Pay NP No
Nursing Bank (Main Income) Yes Main Basic Annual Income Latest 3 months payslips
Nursing Bank (Other Income) Yes Other Nursing Bank Latest 3 months payslips
Occupational Sick Pay Yes Main Basic Annual Income Latest months payslips
Offshore Allowance Yes Other Additional Duty Hours Latest 3 months payslips
On Call Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Overtime Yes Main Annual Regular Overtime Latest 3 months payslips
Pension Supplement Yes Other Colleague Flexible Benefits Latest 3 months payslips
Pension Tax Credits Yes Other Pension Credit Latest Bank Statement or Pension Statement
Permanent Health Insurance (PHI) The term must not extend past the final payment date for PHI if affordability is based on this income only Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Personal Independence Pay Yes Other Personal Independence Pay Latest Bank Statement or Benefit Award Letter
Petrol Allowance No
Piecework No
Project Disbursement Yes Other Town / Area / Car Allowance Latest months payslips
Private Pension / Private Widowers Pension Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Profit Related Pay No
Protection of Pay Allowance No
Public Holiday Pay (only if it forms part of basic pay and doesn't inflate income) Yes Main Basic Annual Income Latest months payslips
Recruitment and Retainment Pay Yes Other Additional Duty Hours Latest 3 months payslips
Renewable Energy No
RHI Payment No
Savings No
Scholarship No
Scottish Island Allowance/Distant Island Allowance/Island Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Seasonal Contract No
Secondment Allowance No
SEN Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Shift Allowance Yes Other Shift Allowance Latest 3 months payslips
Sleepover Allowance Yes Other Additional Duty Hours Latest 3 months payslips
Standby Allowance Yes Other Additional Duty Hours Latest 3 months payslips
State Pension Yes Other Pension - State Latest Bank Statement or Pension Statement
State Widows Pension. (Please see above if Bereavement Allowance). Yes Other Pension - State Latest Bank Statement or Pension Statement
Statutory Maternity Pay No
Statutory Sick Pay (if returning to work see Occupational Sick Pay) No
Stipend (Only acceptable for Clergy) Yes Main Basic Annual Income Letter of confirmation from Religious Order
Tax Rebate No
Temporary Contract No
Term Time Allowance Yes Other Additional Duty Hours Latest 3 months payslips
The Thalidomide Trust Income Yes Other Pension - Private Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60
Tips Yes Main Annual Regular Overtime Latest 3 months payslips
Town Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Travel Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Teaching and Learning Responsibility (TLR) Yes Main Basic Annual Income Latest months payslips
Tool Allowance No
Tronc Yes Main Annual Regular Overtime Latest 3 months payslips
Trust Income No
Uniform Allowance No
Universal Credit (The applicants on the mortgage must be the same as on the award letter and a joint income must be split between the applicants. Applicants must have an earned income for this income to be used. Any Housing Benefit shown on the award letter should be deducted from the income keyed as it will no longer apply) Yes Other Universal Credit Latest Benefit Award Letter
Unsocial Hours Yes Other Shift Allowance Latest 3 months payslips
War Disablement Pension Yes Other Pension - War Disablement Latest Bank Statement or Pension Statement
War Widow(er) Pension Yes Other Pension - War Widow Latest Bank Statement or Pension Statement
Widowed Parents Allowance Yes Other Widowed Parents Allowance Latest Bank Statement or Pension Statement
Widows Allowance No
Work Outside Normal Hours Yes Other Additional Duty Hours Latest 3 months payslips
Working From Home Allowance Yes Other Town / Area / Car Allowance Latest months payslips
Working Tax Credit Yes Other Working Tax Credit Latest Bank Statement or Benefit Award Letter
Working Time Directive Payment (WTD) Yes Other Additional Duty Hours Latest 3 months payslips
Zero Hours Contract (The customer must have been employed on a zero hours contract for a minimum of 12 months (with the same employer or with different employers but in the same type of work)) Yes Main Basic Annual Income 12 months' worth of payslips (this applies whether the applicant is paid weekly or monthly and could consist of P60 plus subsequent payslips to cover the full 12 month period)

Additional Information:
Length of employment/self-employment
Rental Income
Self-employed Applicants
Pension Income
Contractors
Self-Employed/Contractors
Second Job
Tax on Rental Income


 Length of Employment / Self Employment

Employed applicants will be expected to have been employed for a minimum of 3 months in their current job.

Self Employed applicants must have been Self Employed for a minimum of 2 years and be able to provide at least 2 years' worth of trading figures.

Applicants who have transitioned from Employed to Self Employed (in the same line of work) must still meet the Self Employed criteria.

Additional Information:
Contractors
Income Types
Rental Income
Self-employed applicants
Self-employed/Contractors
Tax on Rental Income
Affordability and Sustainability
Second job


 Rental Income

For Employed, self-employed and retired applicants, rental income and finance costs as detailed on tax calculations should be captured in the 'Land and Property Income' section of the application. Details on how this will need to be keyed can be found in our Hints & Tips PDF (1.8MB).

For all Remortgages and Further Advances, the current achieved rental from the property in question should be keyed on the application as the current rent paid by the tenant per month.

For a BTL purchase and LTB remortgage, the current rental keyed will be the anticipated monthly rent of the property in question, once it is let.

The gross monthly rent will need to be keyed into the property schedule screen for all Buy to Let properties owned by any named applicants.

A tenancy agreement or letter from the letting agent can be used to verify the rental income keyed in the Property Schedule screen.

Additional Information:
Tax on Rental Income
Affordability and Sustainability
Income Types
Self-employed applicants
Self-employed/Contractors
Contractors


 Second Job

In cases where the customer has more than one job, we will consider the following when deciding whether or not to take the secondary income into account. Hours worked, are they sustainable? Are the roles/skills similar? What is the distance between the jobs and the customer's home? How long has the customer been in both jobs? Is the salary consistent with the type of employment? And the number of days the customer works per week.

Once all of the above has been taken into account, you should key the highest income as the customer's main income, and the income from the Second Job should be keyed as an additional employment.

Additional Information:
Rental Income
Tax on Rental Income
Self-employed applicants
Self-employed/Contractors
Contractors
Income Types
Affordability and Sustainability


 Self Employed Applicants

Self Employed applicants must have been Self Employed for a minimum of 2 years and be able to provide at least 2 years' worth of trading figures.

If any of the following applies, the customer must be keyed as self employed;

  • Where the customer has a shareholding of 25% or more
  • If joint customers own 25% or more between them, treat both customers as self-employed (both applicants need to hold a % share)
  • A sub-contractor who derives income from more than one contract
  • A customer has a partnership interest in a business, i.e. income is not PAYE, irrespective of the percentage shareholding
  • A customer owns a franchise
  • A customer employed by a Private Limited Company (LTD) who receives a salary (PAYE) and dividends as part of their remuneration package
  • A customer who is in a Limited Liability Partnership (LLP) and receives a share of Net Profits.

For applicants who are classed as self-employed, you should capture all of their income under the field "Net Profit" except profit from UK Land & Property which needs to be captured in the Land and Property Income section. Whilst some self-employed income we allow is not truly 'net profit', we use this field in our affordability assessment and in our policy rules.

The Net profit field should be completed as following:

  • Limited company key total of salary/remuneration + dividends drawn (as shown on Tax Calculation)
  • Partnership (or LLP) key profit share (percentage of)
  • Sole trader key net profits

Documentation required

  • Latest 2 Years HM Revenue & Customs (HMRC) Tax Calculation accompanied by corresponding Tax Year Overviews –The year the Tax Calculation relates to and the Customer's name/initials must show. Tax Calculations can be obtained from the customer's online self-assessment account.
  • The following details must be visible on the online Tax Calculation:
  • HMRC logo
  • Unique Tax Reference (UTR)
  • Customer's name
  • Tax year (most recent no older than 18 months old), and the following wording: "This is a copy of information held on your official online SA tax account with HMRC", and "Submission is 100% complete."

Online tax assessments produced by accountants' commercial software (accompanied by corresponding Tax Year Overviews) are acceptable provided they show the following:

  • Unique Tax Reference number
  • Customer's name
  • Tax Year (most recent no older than 18 months old).

The tax due figure on the Tax Calculation and Tax Year Overview will usually exactly match. If there is a difference in the tax figure we will consider these but may require updated documents.

Latest 2 Years Full Accounts – must be finalised and clearly show the net profit (for Sole Traders), share of net profit (for Partnerships) or salary & dividends (for Directors of Limited companies).

Profit & Loss statements alone are not acceptable.

The year end on all documentation must be the most recent and must not be dated more than 18 months before the date of application.


Additional Information:
Self-employed applicants
Self-employed/Contractors
Contractors
Rental Income
Tax on Rental Income
Income Types
Affordability and Sustainability
Second job


 Self Employed / Contractors

Income Type

Acceptable?

Main or Other

Treat As

Evidence

Contractor - If applicant earns more than £500 per day or £75,000 per annum - providing 12 months or more continuous employment with 6 months of contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Yes

Main

Basic Annual Income

Copy of the contract and latest months personal/business bank statement(s) showing the salary credit

Contracts - Fixed / Short / Temporary - If Company Paying Tax (Excluding CIS contractors) - providing 12 months or more continuous employment with 6 months of the contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Yes

Main

Basic Annual Income

Latest months payslip(s)

Contracts Fixed / Short / Temporary - If Customer Paying Tax

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

IT Contractors - providing 12 months or more continuous employment with 6 months of the contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Yes

Main

Basic Annual Income

Copy of the IT Contract and latest months personal/business bank statement(s) showing the salary credit

CIS Contractors - If Company Paying Tax key as employed providing 12 months or more continuous employment with 6 months of contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Yes

Main

Basic Annual Income

Latest three consecutive months payslip/invoices (this applies whether the applicant is paid weekly or monthly) and three months corresponding bank statements. P60/Payslips If no income is received or the customer is unable to provide evidence of income then ‘zero’ income
must be used for that month

CIS Contractors - If Customer Pays Own Tax or has more than one contract or is employed by Ltd company he/she has set up then treat as Self Employed

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Employed in a Family Business Equal to or greater than 25% Invested interest and/or receives dividend or net profit as part of their reward package(Treat as Self Employed)

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary ONLY less than 25% shareholding (Treat as employed)

Yes

Main

Basic Annual Income

Latest months payslip(s)

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary ONLY Equal to or greater than 25% shareholding (Treat as self employed)

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary + dividends ONLY Irrespective of share holding (Treat as Self Employed)

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary + Net Profits ONLY irrespective of share holding (Treat as Self Employed) Note: Net Profits cannot be used without referral to Underwriters

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Self employed - Sole Trader

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Self employed / Share holding of a Non Ltd Company (ie Partnership) Taxable Income

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Partner of LLP receiving profit share as part of their salary package Irrespective of share of equity (Treat as Self employed)

Yes

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Employee of LLP - not equity shareholding partner. (Treat as employed)

Yes

Main

Basic Annual Income

Latest months payslip(s)

Seasonal Contract

No

Piecework Contract

No


 Tax on Rental Income

Under the BTL Landlord tax rules which took full effect in April 2020, finance costs will not be tax deductible but tax relief can be claimed at the basic rate, whatever rate of tax the customer pays. This will result in an increased tax liability for some landlords. Where applications are referred for manual review, we will consider the additional tax liability where appropriate.

Customers must seek independent tax advice if they're unsure how the tax rules will affect them.

Additional Information:
Rental Income


Lending 

 Assignable Contracts

Applications which involve assignable contracts or irrevocable powers of attorney in favour of intervening sellers are not acceptable. Any other structure to the transaction which has a similar effect should be reported to us. Assignable contracts allow the original buyer to sell the property before legal completion, by assigning the contract to buy the property to a new buyer after contracts have been exchanged with the developer.

Additional Information: New Build


 Bankruptcies

The Credit History question should be answered as 'Yes' if any customer has had a Bankruptcy / IVA / Debt Management Arrangement or Debt Relief Order which was:

  • Registered within the last 6yrs (whether now completed or not)
  • Or;

  • Is still outstanding (whenever this was registered)

If a Bankruptcy / IVA / Debt Management Arrangement or Debt Relief Order was registered over 6yrs ago and is no long outstanding, the question can be answered as 'No'

Additional Information:
County Court Judgements (CCJs)
Mortgage Arrears


 BUSINESS / CONSUMER BUY TO LET

There are two categories of Buy to Let; Business Buy to Let (BBTL) and Consumer Buy to Let (CBTL), both of which are available through BM Solutions.

A Business Buy to Let (BBTL) is a mortgage used to purchase/remortgage a property that is/was purchased with the intention to let to a non-family member or where the majority of the borrowing is for BTL purposes.

A Consumer Buy to Let is when the customer has entered into or is entering into a contract not wholly or predominantly for business purposes. You will need to obtain Consumer FCA permissions before submitting CBTL applications. A Consumer Buy to Let is:

  • Where the property was not originally purchased for letting and the customer does not let out any other properties i.e. Customer or a family member has previously lived in this property.

    And/or
  • Where the majority of the borrowing is for non-Business Purposes.

The answers provided will establish whether the loan is classified as a BBTL or CBTL. BBTL mortgages are not regulated and CBTL mortgage is regulated by the HM Treasury.

Loan purpose is a key factor in determining whether lending will be unregulated Business BTL or regulated Consumer BTL. When applying for a Remortgage with Additional Borrowing or a Further Advance, the loan purposes listed below will be available via our online application system:

Business BTL loan purpose

  • Buy BTL Property Freehold
  • Buy Land Adjacent to BTL Property
  • Buy Extension of Lease to BTL
  • Buy Final Share being Mortgaged
  • BTL Repairs
  • BTL Loan/BTL Deposit
  • Repay Existing BTL Loan

Consumer BTL loan purpose

  • Consumer Goods/Funds
  • Non BTL Debt Consolidation
  • Non BTL Home Improvements
  • Non BTL (Resi/Second Home) Loan
  • Repay Subsequent Charge - Clearing Bank
  • Repay Subsequent Charge - Non Clearing Bank

The full list of loan purposes above may not be available for every application. Availability of each loan purpose will depend on the circumstances of an individual application.


 Concessionary (Discounted) Purchase

We do not accept applications where the property is being purchased at below full market valuation (Concessionary Purchase).

The exception is the purchase of a New Build property where the value has increased between agreement to purchase and building completion. Builder Incentives are acceptable subject to our existing criteria.

It is acceptable to purchase a BTL property from a family member, provided the deposit is sourced from the applicant's own resources and the property is purchased at full market value. Gifted deposits are not acceptable in these circumstances, even if the donor is a different family member from the vendor.

Any BTL property cannot be let to a family member.

Additional Information: Builder Cash Incentives


 County Court Judgements (CCJs)

The Credit History question should be answered as 'Yes' if any customer has had a County Court Judgement (CCJ) or default registered against them, or if self employed against their business, within the last 6 years. CCJs are generally taken into account in credit scoring however background details are required.


Additional Information:
Mortgage Arrears
Bankruptcies


 Credit Score Decline Appeals

All applications will be credit scored. If an application is declined as it has not passed the credit score customers have a right to appeal and whilst we'll always reconsider carefully, without new information it is very unlikely that we will be able to change our decision.

Please give careful consideration before submitting an appeal for assessment. The list below provides guidance on the scenarios in which an appeal may be successful:

Porting application with no additional borrowing

BFPO Address

The client is in the British Armed Forces and living at a BFPO address.

Victim of Fraud

The fraud has been reported to the Police and Credit Industry Fraud Avoidance system (CIFAS) and can be evidenced by a crime reference number.

Adverse Credit Data Registered in Error

An error by Lloyds Banking Group can be evidenced.

If the adverse information has been registered on a non-Lloyds Banking Group product an appeal cannot be submitted and the customer should arrange for their records to be corrected before a new application is submitted.

For scenarios that fall outside of this list it is likely the final decision will remain unchanged.

Please refer to our Credit Scoring Guide.


 Dependants

A dependant is anyone who is financially reliant on your customer, who is not a party to the mortgage and does not contribute to the mortgage payments. A dependant may be a child, spouse not party to the mortgage, adult or elderly relative or a future dependant.

You need to capture separately both Child and Adult Dependants.

Child Dependant

A child dependant would include any children for which the customer(s) is the primary carer and who is under 18. A child dependant would include a future dependant where the customer is expecting a baby or is in the process of adopting a child. Foster children do not need to be keyed as dependants.

Where any children have income and can fully support themselves they do not need to be keyed as a dependant.

If a child is not living with the customer(s) and maintenance is being paid, a dependant does not need to be keyed, but the maintenance amount must be keyed as a commitment.

Adult Dependant

An adult dependant is someone who is not party to the mortgage but is financially reliant on the customer. This could be a spouse/partner, elderly relative or grown up children who are unemployed or in full time education.

Where the adult dependant resides at the property for some of the time, you would key this in the adult dependant field.

Alternatively, where the customer financially supports an adult dependant who doesn't reside at the property, they would not be keyed as a dependant, but the related costs instead must be keyed as a total figure in "Other Commitments".


 Deposits

For all Buy to Let applications, apart from remortgages, the source of deposit must be captured and evidence must be retained. The deposit 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 75% on a New Build property. The valuer must be aware of any incentive and refer to this in the valuation report.

For certain applications, deposit verification will be requested. Evidence will also be required when the application is subject to underwriter review, and/or a message is displayed at DIP submission and the Additional Requirements section of the Submit Application Results screens at full application.

The following deposits are not acceptable:

  • Any deposit coming from a business, whether from a business current account, a business loan or directors loan account is not acceptable
  • Vendor gifted deposits are not acceptable
  • Second charges are not an acceptable source of deposit

A list of acceptable documents is detailed in the following sections: Please note that these are the minimum requirements and you will be expected to send in the appropriate documents according to the type of deposit being verified.

Proof of deposit documentation will only be reviewed once evidence of the full deposit amount shown in the required documents as detailed below are received. Please obtain and send in full deposit documentation to ensure your case is processed promptly.

Equity:

  • The credit reference summary should confirm that a mortgage already exists
  • If no mortgage is found on the credit reference file a copy of the most recent mortgage statement (within the last 12 months) will be requested
  • In order to validate the equity amount, we will also request the Sales particulars
  • If the customer is remortgaging or taking a further advance on an existing property where the funds will be used as a deposit on a new purchase through BM Solutions, we would want to either see the funds in an account (follow savings) or an offer guaranteeing the lending

Gift:

Gifted deposits are acceptable, but only from family and must be non-repayable. The property cannot be let to, or purchased from a family member if a gifted deposit is involved. Evidence of the source of deposit must also be retained by the Broker in all cases, as this may be requested for a small number of applications.

Inter-Family purchases are acceptable, subject to it being sold at full market value. The purchaser must provide their own deposit, and this must come from an acceptable deposit source other than 'Gift'. The purchaser also must be a resident in the UK.

Vendor Gifted Deposits are not acceptable.

Brokers will need to provide a letter written by the donor with all of the following requirements;

  • Is addressed to BM Solutions/Birmingham Midshires
  • Details the person/people gifting the deposit and the current name/address of the applicant(s), together with the property being purchased
  • Confirms the relationship between the donor(s) and the applicant(s). The donor should be a family member. See definition of family members below.
  • Details the donor's full address and is signed
  • Confirms the amount of deposit, and that it is non repayable and that the donor will hold no interest in the property following completion of the mortgage
  • Is dated within the last 3 months

Please see our Gifted Deposit letter template.

For gifted deposits, in addition to a letter from the donor confirming the gift, Brokers must also provide the latest UK bank statement or passbook showing evidence of the deposit funds in the donor's or applicants UK bank account. Alternatively, a letter from the donor's or applicants UK bank confirming the funds are available may be provided.

Additional statements or other documentation may be requested where required.

The definition of a family member is someone who is related to at least one of the applicants:

  • By birth/blood relative
  • By marriage or civil partnership (including step children, adopted children and in-laws)
  • As 'Common Law' partners or co-habitees

Acceptable Not Acceptable
Parents, step parent, parents in laws Family Friend
Brothers and sisters, half brothers and sisters, step brothers and sisters, brother and sister in laws Employer
Grandparents, step grandparents Developer/ Landlord
Auntie/Uncle (related by blood)
Niece/ Nephew
Auntie/Uncle (related via marriage)
Partners living with applicant either common
law or co-habitee
Cousins
Applicants' children, step children, son and
daughter in laws and adopted children
Foster/Guardian children

Inheritance:

If requested, either UK based Current Account or Savings Account statements will need to be provided, or alternatively a passbook. Please see Savings for more details.

Loan:

Deposit funds should come from a personal stake, and as such, a deposit provided by way of a loan is not acceptable.

Military Personnel:

The Forces Help to Buy scheme (previously called Long Service Advance of Pay) cannot be used as a deposit for a Buy to Let property.

Previous Property Sale:

Please follow the guidance under the Equity or Savings options

Savings (held in the UK):

If requested, you will need to provide as a minimum:

Current Account, ISAs or Savings Account statements with all of the following requirements;

  • 3 months' statements, showing applicant(s) name, sort code, account number and company name (or latest annual statement if longer term savings plan)
  • Statements should be in the same name as at least one of the applicants named on the new mortgage
  • Latest statement must show a closing balance covering the deposit required
  • Any recent large or unusual deposits into the account will require clarification to ascertain proof of origin. Where funds have originated from a Business Account, you must obtain confirmation from the accountant that the withdrawal will not have a negative impact on the business.

Shares, with all of the following requirements;

  • Certified copy of Share Certificate showing applicants name and address
  • Evidence of current share value calculation showing the value of shares

    • e.g. 5000 shares x £3 current share prices = £15,000

Premium Bonds, you will need to provide the following;

  • Premium Bond Certificate showing name of applicant and value of premium bond(s) held
  • Additional documentation to verify applicants name and address is same as applicant named on the premium bond

Or a passbook with the following requirements as a minimum;

  • Passbook should show applicant(s) name and account number
  • Passbook should be in the same name as at least one of the applicants named on the new mortgage
  • Passbook should cover, at least, the latest 3 months' transactions and the closing balance must cover the deposit required
  • Any recent large or unusual deposits into the account will require clarification to ascertain proof of origin

Where funds are held over multiple accounts or sources, the above process should be followed for each account.

Other Source:

We will need to ascertain exactly where the deposit is coming from. If the deposit type does not align to one of the above listed options, it is not acceptable.

Additional Information: Builders Cash Incentives


 First Time Buyer / First Time Landlord

On sole named applications
The applicant does not need to be an owner occupier but must currently own a property in the UK in their personal name i.e. a non-LTD company BTL which will need to be validated before an offer can be made.

On applications with more than one applicant
At least one applicant must currently own a property in the UK in their personal name which will need to be validated before an offer can be made. Any other named applicants can be first time buyers.

First Time Landlords are acceptable.

Our criteria and products are the same for first time and experienced landlords.

Where possible, we will use the credit reference search to validate property ownership. If this information is not available via the credit reference file or the property is unencumbered we may request the documentation listed below.

England and Wales:

  • Land Registry certificate dated within the last three months which must show at least one of the applicants names, or
  • A copy of a recent mortgage statement dated within the last three months which must show at least one of the applicants' names, or
  • A copy of a mortgage statement over three months old plus last three months bank statements confirming payment. Both must show at least one of the applicants' names.

Scotland:

  • Land Registry certificate dated within the last three months. This must show at least one of the applicants' names. Where no date is available on the certificate, adequate proof that this was requested within the last three months is acceptable (either from the Land Registry or the solicitor), or
  • A copy of a recent mortgage statement dated within the last three months which must show at least one of the applicants' names, or
  • A copy of a mortgage statement over three months old plus last three months bank statements confirming payment. Both must show at least one of the applicants' names.

Northern Ireland:

  • Land Registry certificate dated within the last three months. This must show at least one of the applicants' names. Where no date is available on the certificate adequate proof (either from the Land Registry or the Solicitor) that this was requested within the last three months is acceptable, or
  • A copy of a recent mortgage statement dated within the last three months which must show at least one of the applicants' names, or
  • A copy of a mortgage statement over three months old plus last three months bank statements confirming payment. Both must show at least one of the applicants'.

 Letting Criteria


The property may be let on a single Assured Shorthold Tenancy (in England), an Occupation Contract (in Wales), Private Residential Tenancy (in Scotland), a private tenancy (in Northern Ireland, in which case when creating the tenancy it must comply with the provisions of the Private Tenancies (Northern Ireland) Order 2006).

The minimum tenancy term is 6 months. The maximum tenancy term is 36 months although a maximum tenancy of 5 years is acceptable when the tenancy is in the form of a Dept for Levelling Up, Housing and Communities (DLUHC) model agreement of September 2014 (or as amended) or the Scottish Equivalent.

In Wales, new tenancy agreements from 1st December 2022, will be on an Occupation Contract. Existing agreements will automatically convert to an Occupation Contract and written statements of the converted contract need to be issued by 1 June 2023.

A BTL Remortgage application cannot be started without a tenant in place and must have a Tenancy agreement at the time of submission. Where a Tenancy is due to commence the customer must have a Tenancy agreement confirming the expected rental income and the start date must be within 14 days of the application.

The property may be let to a company on a corporate let. The maximum term is 12 months. Our consent is not required to renew the tenancy, but the occupiers need to be named on the tenancy and they must be employees of the tenant company.

The maximum number of unrelated tenants is 5. They must all be party to the agreement. It is the landlords responsibility to ensure that all legislation is complied with including (but not restricted to) legislation relating to Tenancy Deposit schemes and HMOs (Houses in Multiple Occupation).

For larger property e.g. where there is a potential of more than five lettable rooms, the valuer must be satisfied that the property and the local market reflects single family letting arrangements.

Properties subject to Local Authority Homes in Multiple Occupation (HMO) licensing may be acceptable, subject to the valuer's assessment of suitability based on our requirements.

Tenants in the following categories are not acceptable:

  • Asylum seekers.
  • Persons who have or may acquire diplomatic immunity.
  • Social landlords (such as Housing Associations).
  • Holiday lets
  • Rent Act protected tenants
  • Agents of any of the above
  • Family members

The tenancy agreement must provide that assignment or sub-lettings to tenants in these categories are not allowed.

  • Multiple tenancies (where each tenant signs a separate agreement) are not acceptable.
  • If the property is in Scotland, the landlord must register with the relevant Local Authority.
  • Applications which involve a sale and leaseback arrangement are not acceptable.
  • Limited company purchases – no lending allowed to purchase from own limited company.
  • Trust Deeds are not acceptable.
  • The property must not be subject to occupancy restrictions.
  • Applications will not be accepted where a second charge is being completed at the same time as the BTL application.

Additional Information: Houses in Multiple Occupation



 Lending Limits

A £3,000,000 lending limit applies to all Buy to Let, Let to Buy, Consent to Let, Second Home Loan and House 2 House borrowing across the Retail Division of Lloyds Banking Group.

Maximum lending on each individual Buy to Let or Let to Buy property of £1 million. Where LTV is 65% or below and EPC rating of the property is A, B or C the maximum lending is £2 million.

A maximum of 5 properties applies to all Let to Buy, Buy to Let, Second Home Loan, Consent to let and House 2 House lending across the Retail Division of Lloyds Banking Group. This consists of Bank of Scotland, Birmingham Midshires, TMB, Halifax, Intelligent Finance, Lloyds Bank, C&G and Scottish Widows.

Where more than 5 properties are held no additional borrowing is allowed.

The maximum LTV is 75% (65% for loans between £1 million and £2 million where EPC rating is A, B or C). This includes New Build properties and there is no variation in LTV limits for flats.

The minimum loan amount is £25,001. For further advances, the minimum loan amount is £5,000.

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.

Additional Information:
Min/Max Term
Min/Max Age
Portfolio Landlords


 Min / Max Age

Minimum age 21 years.

The eldest applicant must submit the application before their 75th Birthday as we cannot exceed age 75 at the time of submission and age 80 at the end of the term.

Additional Information:
Min/Max Term
Lending Limits


 Min / Max Term

Maximum term is 40 years, the term must not exceed the eldest applicants 80th birthday.

Minimum term must not be less than the selected product term.

Additional Information:
Lending Limits
Min/Max Age


 Mortgage Arrears

The Credit History question should be answered as 'Yes' if any customer has been in arrears in the last 6 years with any borrowing or ever had a property repossessed. Applications where previous mortgages have been in arrears will be considered on an individual basis.

Additional Information:
County Court Judgements (CCJ's)
Bankruptcies


 Mortgage Free / Unencumbered Properties

Loans on mortgage free properties are treated as remortgages. The customer is eligible for the remortgage products and incentives e.g. no cost for property assessment and free legal service.

How to key:

To ensure that loans on mortgage free properties are processed correctly, the case should be keyed as follows:

  1. Select 'Remortgage' or 'Remortgage – Own Conveyancer' as appropriate in the dropdown list for application type.
  2. Answer 'Is the property to be mortgaged, mortgage free?' as 'Yes' for all applicants.

Note: The property must have been registered in the applicant's name (or at least one of the applicants' names) for a minimum of six months.

Additional Information:
Remortgage and Capital Raising
Free Conveyancing
Inherited Properties
Portability
Business/Consumer BTL
Letting Criteria


 Notional Stress Rates

Lending is assessed using the actual or anticipated rental income from the property. Calculate the maximum amount of capital your customer can borrow to purchase or remortgage their property based on their annual income.

Additional Information:
Credit Score Decline Appeals
Rental Income
Tax on Rental Income

 PORTFOLIO LANDLORDS

The Prudential Regulatory Authority (PRA) issued Underwriting Standards for BTL mortgage contracts in September 2016. These Standards required lenders to implement a specific underwriting treatment for Portfolio Landlords from 30th September 2017. This means lenders will consider the individual transaction and the overall customer portfolio position.

A Portfolio Landlord application is where the customers have 4 or more mortgaged BTL properties including the new transaction. This is based on the total number held by all customers party to the application.

E.g. Applicant 1 has 2 mortgaged BTL properties and applicant 2 has 1 mortgaged BTL property - they are buying a new property together and so have 4 in total and the application is classified as a Portfolio Landlord.

Mortgaged BTL properties include those held in a personal name, Limited Company or any other legal entity.

Process

  • All applications submitted on BM Solutions Online
  • A question will be asked to determine the number of mortgaged BTLs on the application
  • 3 or less, including the new application will continue as current process
  • 4-10, including the new application, will require proof of income and supporting documentation to be uploaded on the integrated document upload tab on BM Solutions Online.
  • If mortgaged properties within the portfolio are held in a limited company, we will require the latest mortgage statement or mortgage offer (if completed in the last 12 months).
  • We require full information about the portfolio keyed onto BM Solutions Online at full application.
    Information required includes: addresses; year built, year of purchase, original purchase price, gross monthly rent, estimated property valuation, whether leasehold, whether managed, and whether mortgaged.

Criteria for Portfolio Landlords

  • No more than 10 BTL mortgaged properties including the new application to BM Solutions
  • Minimum earned income of 30k (per application) – Income defined as; earned income from employment or self-employment (including taxable profit from the property portfolio); pension income; investment income
  • Maximum aggregate portfolio* of 75% LTV
  • Minimum aggregate portfolio Rental Cover Ratio of 145% stressed at 5.5%
  • Subject property must meet standard criteria
  • Please check the maximum amount the customer can borrow here Full Rental Income Calculator.

* Based on the entire portfolio including acquiring property and any unencumbered let property.

Unencumbered Let Properties

These are not included in the count of mortgaged BTL properties, but the rent and property value must be declared in the property schedule and portfolio details sections of the application.

Finance Costs

Since 6 April 2020, tax relief on finance costs for landlords of residential properties is restricted to basic rate of income tax, regardless of which tax band the landlord falls into. Accordingly, profit from land and property as it appears on a tax calculation no longer has finance costs deducted.

You will be required to input the latest years finance costs on the application and our underwriters will deduct the finance costs from the profit from land and property to understand what the client's useable income figure is.

Additional Information: Lending Limits


 Remortgage and Capital Raising

For Remortgage applications, including unencumbered properties, a customer must have owned the property for a minimum of 6 months.

The following reasons for capital raising are not acceptable:

  • Gambling
  • Injection of capital into a business
  • Start up of a new business
  • Purchase of timeshare

We will however allow capital raising for a deposit for a BTL purchase in personal or limited company name.

Underwriters reserve the right to request evidence of how funds will be used if they have concerns.

Additional Information:
Mortgage Free Properties (Unencumbered properties)
Free Conveyancing
Portability
Business/Consumer BTL
Letting Criteria


 Repayment Methods

Repayment, Interest Only or a combination of the both are acceptable. The method(s) for repaying Interest Only element must be specified.


Property 

 Builder Cash Incentives

Builder cash incentives include but are not limited to deposit contributions, cash-backs, contribution to legal fees/stamp duty, and mortgage subsidies.

Builder cash incentives will typically be acceptable provided the value of these does not exceed 5% of the lower of purchase price/valuation. Cash incentives in excess of this amount may result in a reduction in the maximum loan available.

All builder cash incentives must be declared at the point of sale, and all lending decisions are based on either the valuation or purchase price (whichever is lower).

Additional Information: New Build


 Buy to Let Property Address

The Buy to Let property address must not be the same as the applicant(s) correspondence address.


 Cladding

In England and Wales, for properties in buildings that are five storeys or higher we will no longer require an External Wall System (EWS1) form in order to progress an application. We will also be able to consider applications on properties where cladding remediation work is required but not yet completed. This only applies to buildings five stories or higher therefore EWS1 forms may still be required for buildings four storeys or lower and for properties in Scotland, Wales or Northern Ireland.

The surveyor will advise when an External Wall System (EWS1) form is required to confirm the status of the external wall system and any applicable attachments e.g. balconies on multi occupied, multi storey buildings of any height.

It is the responsibility of the building owner and/or its agent (in Scotland individual customers have to source the EWS1 form) as the responsible person to:

  • Confirm that an external wall system (EWS) or attachments, such as a balcony, on buildings containing flats has been assessed by a suitable expert for likelihood of proportionate remediation to address fire safety risk.
  • The EWS1 form must be prepared by a suitably qualified independent professional advisor.
  • Professional advisor must be a member of one of the professional bodies as listed by the RICS - List of professional bodies.

We will be unable to confirm if a property is acceptable until a valuation has been instructed.

For purchase cases a special condition will be added to a mortgage offer to instruct the conveyancer to advise the customer that the offer has been made on the reliance of an EWS1. It will also ensure that the customer knows that neither ourselves or surveying providers are liable for the information that was contained in the EWS1 form.

New Build

For New Build high rise blocks over 6 storeys/18m in height (England and Wales) or 4 storeys/11m in height (Scotland) Building Regulation compliance, The Building (Amendment) Regulations 2018 or local equivalent can be relied on, subject to the conveyancer receiving confirmation of this from the building owner, and/or its agent or duty holder. Where this cannot be obtained the above criteria applies.


 Condition

The property must meet minimum criteria. Must be habitable, readily lettable/saleable, structurally sound and be able to have buildings insurance arranged upon it.


 Construction

The property must be situated within the UK and subject to a UK legal jurisdiction. Property acceptability is based on a satisfactory valuation report from the bank's appointed valuer.

Non-standard construction will be assessed on individual merit.

Certain types of pre-cast reinforced concrete (PRC) construction are designated defective and may not be acceptable unless repaired.

We will be guided by the suitability of all mortgage properties by the Valuer.

  • Adjoining property purchases are acceptable however will be subject to valuer's comments.
  • Houseboats and mobile homes/park homes are not acceptable.
  • Properties with Annexes are permitted as long as the annexe forms part of the main title and are not split. There should also be no separate tenancy agreement in place with respect of the annexe accommodation.
  • Studio flats are acceptable subject to valuer's comments. There is no minimum size (sq ft) requirement, the acceptability is subject to valuer's comments.
  • Right to Buy/Shared ownership applications are not acceptable.
  • If a flat is part of a conversion where the total number of flats in the scheme is above eight, the valuer must confirm that the whole conversion project has been or will be completed to a high standard.
  • Flats above/adjacent to a business which is owned by the same person are not acceptable. Flats above/adjacent to a business not owned by the same person are subject to valuers comments.

For details of our requirements for security where a property has been converted into flats or is part of a purpose-built block, see Tenure of flats.


 Distressed Sale and Leaseback

Applications that involve a distressed sale or a sale and leaseback are not acceptable.


 Energy Performance Certificate

An Energy Performance Certificate (EPC) for a domestic building gives the property an energy efficiency rating from A (most efficient) to G (least efficient) and is valid for ten years. The EPC relates to the property rather than to the owner, therefore an EPC obtained by a previous owner of the property will remain valid even after a property is sold on, providing it is less than ten years old.

  • Properties must have a valid Energy Performance Certificate (EPC) and a minimum rating of E or above.
  • Properties with F or G EPC rating are only allowed where a registered exemption is in place.
  • This criteria applies in England, Northern Ireland, Scotland and Wales.
  • Applies to Buy to Let purchases and remortgages, Let to Buy remortgages and further advances. Product transfers are exempt.
  • For New build use rating from either Predicted Energy Assessment (PEA) or Standard Assessment Procedure (SAP) if no EPC available.
  • If property is exempt, evidence of exemption is not required to be uploaded to application unless requested.
  • Evidence of Energy Performance Certificates (EPC), Predicted Energy Assessments (PEA), Standard Assessment Procedures (SAP) or Exemption evidence should be retained on file.

 Exposure Limits

Where a site is assessed as suitable for lending, we'll no longer apply an initial cap on our lending exposure. We'll continue to monitor applications (exposure) as the development progresses and may restrict further lending only if concerns arise.

There may be a small number of sites where we decide not to lend on due to specific market or site conditions.


 Free Valuations

Where a free valuation is selected as part of a product incentive, the appeal process on the property valuation is not available. If you wish to appeal the rental valuation on a BTL remortgage application, please contact us to discuss.


 Houses in Multiple Occupation

Properties subject to Local Authority Homes in Multiple Occupation (HMO) licensing may be acceptable, subject to the valuer's assessment of suitability based on the following requirements:

  • Maximum of five unrelated tenants. They must all be party to the agreement. It is the landlords responsibility to ensure that all legislation is complied with including (but not restricted to) legislation relating to Tenancy Deposit schemes and HMOs (Houses in Multiple Occupation)
  • The property must be suitable for standard residential occupation
  • Institutional type properties, for example hostel accommodation/bedsits/shared accommodation comparable to halls of residence, are not acceptable
  • Large properties i.e. where there are more than five lettable rooms, in an area where letting arrangements are predominantly multiple-tenancy, are not acceptable
  • The property may be let on a single Assured Shorthold Tenancy (in England & Wales), a Private Residential Tenancy (in Scotland), a private tenancy (in Northern Ireland, in which case when creating the tenancy it must comply with the provisions of the Private Tenancies (Northern Ireland) Order 2006).

Additional Information: Letting Criteria


 Inherited Properties

We will accept a remortgage on an inherited property where the applicant is a beneficiary but has not owned the property for 6 months.

Probate must have been granted prior to application and written confirmation of the inheritance of the property and grant of probate will be required from the customer's conveyancer.


 Japanese Knotweed

We will lend subject to the valuer confirming the property is suitable mortgage security and providing a present condition valuation figure. To assess the property the valuer will require a report outlining the issues and a quote from a treatment company who must either be a member of the Property Care Association or be able to offer a warranty backed treatment plan. If treatment is advised and where possible, then this is often over 3-4 years.


 New Build

An Initial Occupancy/New Build property is classed as any property being occupied and/or sold for the first time on the open market in its current state and includes newly converted and refurbished properties. These will fall into one of the following categories:

  • Newly built property
  • Refurbished property i.e. refurbishment of an existing residential property. Typically a re-furbished property will be considered as initial occupancy where the vendor is a builder/developer and the property has been vacated to allow for the refurbishment to be undertaken
  • Newly converted property i.e. conversion of an existing non residential property. An example of this would be an existing mill converted into flats
  • A property, either new or converted (as above), that has been tenanted and is now offered for sale for the first time on the open market by the builder/developer

The property must be subject to one of the following building control and monitoring requirements:

  • Building Standards Indemnity Scheme from a warranty provider accepted by Lloyds Banking Group:

    • ABC+
    • Advantage HCI
    • ARK Insurance
    • Building LifePlans Ltd (BLP)
    • Buildzone
    • Checkmate
    • Global Home Warranties
    • HomeProof (previously Aedis)
    • International Construction Warranties (ICW)
    • NHBC
    • One Guarantee
    • Premier Guarantee - Includes the LABC New Homes Warranty and LABC Hallmark
    • Protek
    • Q Assure Build

For the property to qualify as one acceptable for monitoring by a consultant it must be either:

  • A single detached property (either self-built or otherwise) where construction is monitored by a consultant employed directly by the customer.
  • A property built by a self-build group where construction is monitored by a consultant employed by that self-build group.
  • A property forming part of a small solely residential development comprising not more than 15 units in total where construction is monitored by a consultant employed by the builder or developer. (If flats/maisonettes are involved, each individual flat/maisonette counts as one property). Developments containing more than 15 units need an acceptable form of building standards indemnity.

 Revised Property Details

If the purchase property address changes once a mortgage application has been made, and the customer's original mortgage product has been withdrawn, a new product from the current range must be selected.

If the property being purchased is not changing but an amendment is required to the address keyed e.g. property number or street name this must be amended by us prior to completion. You should contact us to make this change.


 Scottish Valuations

In Scotland, a re-type/transcription report from a Generic Mortgage Valuation Report (GMVR) attached to a valid Home Report prepared to permit marketing of the property is no longer acceptable for a Buy to Let or Let to Buy applications following best practice advice issued by RICS (Scotland), which means that it will no longer contain a rental valuation.

For further clarification please contact your BDM.


 Sub Sales and Back to Back Transactions

Sub-sales and back-to-back transactions are not acceptable.

A sub-sale occurs when a property is bought and then sold on within six months, i.e. the borrower is buying the property from someone who has themselves bought the property less than six months before. The date of registration at the Land Registry is how we determine the length of ownership.

This means that the current vendor must have owned the property for at least six months before we can accept an application to purchase that property, unless the property has been inherited.

A back-to-back transaction is a type of sub-sale where the intervening seller buys from the original seller and sells on to the borrower on the same day or within a few days. We also regard as sub-sales, cases where the seller acquires the freehold (or superior leasehold) title to the property, which they then immediately sell on to the borrower by the grant to them of a lease (or sub-lease).

The following cases are exceptions where it is acceptable for the property to be sold on within six months of acquisition by the seller.

Where sales are by:

  • A personal representative of the registered proprietor; or
  • An institutional mortgagee exercising its power of sale; or
  • A receiver, trustee-in-bankruptcy or liquidator; or
  • A developer or builder selling a property acquired under a part-exchange scheme.
  • A registered Housing Provider (Housing Association) exercising a power of sale.

We will also accept Inherited properties where the applicant is a beneficiary but has not owned the property for 6 months. The conveyancer will be responsible for ensuring the application meets the acceptable criteria.

Applications which involve assignable contracts or irrevocable powers of attorney in favour of intervening sellers are not acceptable. Any other structure to the transaction which has a similar effect should be reported to us.


 Tenure

Freehold and leasehold houses are acceptable. Leasehold properties must have a minimum of 70 years remaining on the lease at application.

Where a property has been converted into no more than four units or is within a purpose build block, any leases should already be in place and not created at the same time as the mortgage application. We will consider lending subject to the following requirements:

Tenure is leasehold and the applicant does not own the freehold or share of freehold:

  • The conveyancer will ensure the lease meets our standard requirements.

Tenure is leasehold and the applicant owns / will own on completion the freehold of the whole building

  • Our charge must be registered on the freehold of the whole building and the leasehold interest of the unit. The conveyancer will ensure the lease meets our standard requirements
  • The mortgage along with the freehold and leasehold titles must be in the same name. It is not acceptable to hold the freehold in a Ltd company with the customer as sole director, majority shareholder or with any family member
  • It is only acceptable for the customer to own one unit in the whole building, including any new applications

Tenure is leasehold and the applicant owns / will own on completion a share of the freehold of the whole building

  • Our charge must be registered on the leasehold interest only. The conveyancer will ensure the lease meets our standard requirements
  • It is only acceptable for the customer to own one unit in the whole building, including any new applications

Tenure is freehold

  • The security will be registered on the freehold of the whole building and be processed as a freehold house
  • The applicant must own the freehold personally in their own name
  • The mortgage and freehold title must be in the same name. It is not acceptable to hold the freehold in a Ltd Company with the customer as sole director, majority shareholder or with any family member
  • All units other than the freehold unit on which we're lending must be subject to long leases (minimum 70 years)
  • It is only acceptable for the customer to own one unit in the whole building, including any new application.

For developments of more than four units:

  • Tenure must be leasehold
  • A management company must be in place
  • Our customer may hold a share in the management company
  • The conveyancer will ensure arrangements in connection with the management company are acceptable
  • Our mortgage must be registered on the leasehold title

 Unacceptable construction types

Timber or metal framed buildings where the cavity, between frame & cladding, has been retrospectively filled with an insulation material.

Concrete walls as built in Cornwall or Devon before 1950 (1960 for postcodes PL12, 13, 14, 15, 17, 18, 22 & 23) where valuer has recommended a Mundic report and test of the concrete has classified the concrete in either class B or C.

Unrepaired, designated defective properties under the Housing Act 1985, Housing (Scotland) Act 1987, Housing (Northern Ireland) Order 1986 are not acceptable.

Flats or maisonettes of large panel system type unless acceptable structural appraisal on the whole block.

Load bearing panels of asbestos or gypsum plaster construction.

Properties which are structurally unsound & Properties which are uninsurable.


 Use of property

The following property types are not acceptable as security:

  • A dwelling on a single title must not be split into separate units of accommodation (e.g. house converted into two flats). In these situations, each flat would need its own title
  • Any property being purchased from and let to the same family member
  • Bedsits 
  • Commercial Property
  • Ex-local authority flats (unless the majority of the building is owner-occupied)
  • Farms or property with land that is subject to commercial agricultural use
  • Live/Work units
  • Mobile homes/Houseboats
  • Property assessed as unsuitable security by the valuer
  • Property with restricted occupancy
  • Property that is designated defective under the Housing Defects Act 1984
  • Property on which Buildings Insurance cannot be arranged
  • Right to Buy/Shared Ownership applications
  • Timeshares
  • Properties with an Energy Performance Certificate (EPC) rating of F or G and no registered exemption in place

 Valuation

The minimum acceptable property value or purchase price (whichever is the lower) is £50,000.

A mortgage valuation is valid for 12 months. If a mortgage does not complete within 12 months of the valuation being carried out then a new valuation will be required, and a new fee potentially needs to be collected. We will advise you at the time if a new valuation fee is required.

Additional Information: Scottish Valuations

Existing customer 

 Arrears

Where the mortgage has been at least one month in arrears within the last 3 months, a further advance application cannot be accepted.

The customer should be advised to bring their account up to date and be 'arrears free' for at least 3 months before re-applying.

This rule also applies to any standalone product transfers that you may wish to process, however, you can process the product transfer as soon as the account is up to date with no requirement to wait 3 months.


 Early repayment charges

Some of our products have early repayment charges attached to them. An early repayment charge will apply if your client repays some or all of their mortgage during the early repayment charge period.

If your customer chooses a mortgage product with early repayment charges, as a concession, in any calendar year, they may repay up to 10% of the amount outstanding on their product, without having to pay an early repayment charge. We reserve the right to change or withdraw this concession at any time.

On a porting application any Early Repayment Charge which may apply on your customer's current mortgage product will be waived or refunded if the early repayment charge period ends in the next 3 months.

On a Product Transfer application any Early Repayment Charge (ERC) which may apply on your customer's current mortgage product will be waived if the early repayment charge period ends in the next 6 months. You can not start a product transfer application more than 6 months before the early repayment charge period ends.

If the account has multiple sub accounts and one sub account has an Early Repayment Charge that expires in 3 months and another sub account with an ERC expiring in 6 months you will only have the option to complete a Product Transfer application on the sub account that has 3 months remaining until ERC expiry. Once the application has been submitted and the new product has started/taken effect you will be able to apply for a product transfer on the other sub account. Alternatively you can wait until the ERC on all sub accounts has 3 months left until expiry and apply for a product transfer application on all eligible sub accounts.

ERC's will be charged on any overpayments made over the 10% concession even if the customer is within 6 months of the ERC expiry and a product transfer or further advance application is being submitted.


 Further Advances

Minimum further advance amount is £5,000.

When applying for a Further Advance the product chosen must be from the same scheme as the main borrowing i.e. BTL or LTB.

Further advances are not permitted within 6 months of completion of the original mortgage.

The minimum period from completion of the latest Further Advance to any new Further Advance application is 12 months.

Arrears - If the customer has failed to make their monthly payment on the expected due date (resulting in arrears) then you will not be able to apply for a Further Advance until the arrears have been cleared and their payments have been made in full and on time for 3 consecutive months.

You are unable to apply for a Further Advance application at the same time as a product transfer application. If a Product Transfer application has been applied for, you will need to wait until the new product has started/taken effect before the Further Advance application can be submitted. If a Product Transfer application is submitted and subsequently cancelled you will need to wait until the 1st of the following month before applying for a Further Advance application.

Acceptable reasons for a further advance - see Remortgage & Capital raising.

Maximum Loan to Value - existing loan plus further advance amount must not exceed 75% LTV.

Where the total loan required is over £1,000,000 and no more than £2,000,000 the maximum LTV is 65% (only applicable for properties were the EPC rating is A, B or C).

Where the LTV at application is over 75% based on the current index valuation, a revaluation will be required and a revaluation fee payable. Lending will be subject to the value and rental figure following the revaluation. View our current revaluation fees.


 Overpayments

If your customer chooses a mortgage product with early repayment charges, as a concession, in any calendar year, they may repay up to 10% of the amount outstanding on their product, without having to pay an early repayment charge. We reserve the right to change or withdraw this concession at any time.

Overpayments

Lump sum or regular overpayments can be made at any time. If early repayment charges apply to the product, refer to early repayment charges for more details.


 Payment Holidays

Payment holidays are not allowed


 Portability

If an existing BTL mortgage is repaid while an Early Repayment Charge (ERC) applies this charge will be due unless the amount on the existing product is ported to a new application.

If a product is portable this is outlined in the original mortgage offer and supporting documentation. You cannot port a product onto a remortgage application where the property is currently mortgaged, but can port to a remortgage of an unencumbered (mortgage free) property the customer already owns or a new purchase.

Where a new application is submitted prior to redemption of the current mortgage the product can be ported.

The ERC can also be waived without porting, if a new mortgage is being taken in the last 3 months of the ERC period of the current product or the ERC can be refunded if you apply for a new application on a new product within 3 months of an existing BM BTL mortgage being redeemed.

For more information please see our Porting Guide (PDF, 49KB) and follow the steps to submission.


 Product Transfers

Product Transfers are available for BTL and LTB customers. Please read our How to Key a Product Transfer PDF (1.6MB) or Product Transfer Quick Guide (136KB).

You can also view our frequently asked questions (PDF, 136KB).

We do not require you to upload any documentation to support a Product Transfer application. For further support, please see our Placing Business - Product Transfers page.


 Product Transfer Timescales

Product transfers can be submitted at any time in the month. The earliest a product transfer can take effect is the 1st of the following month.

Where your client is within the last 6 months of an existing product you can choose to select a new product and forward date the new product to start after the current product has ended.

Where you client is within the last 3 months of an existing product you can choose to start the new product early and we will waive any Early Repayment Charge or you can choose to forward date the new product to start after the current product has ended.

If the account has multiple sub accounts with differing ERC expiry dates you will only be able to submit a product transfer application on the sub account(s) with the shortest time remaining until ERC expiry.

i.e. Sub account 1 product expires on 31st January and Sub account 2 product expires on 31st March. PT application can be submitted on sub account 1 from 1st November with new product starting on 1st December or 1st February. A PT application on sub account 2 can be submitted once the new product has started/taken effect on sub account 1 OR you can wait until 1st January when both sub accounts have 3 months or less left until ERC expiry and submit a PT application to start on 1st February or 1st April.

Early Repayment Charges will still apply on any overpayments made (over the allowable 10%) on the account during this period.


 Regulated Mortgages

BM Solutions no longer accepts any changes to existing Regulated mortgages held with us. This includes the following schemes;

  • Residential
  • Buy to Let (where it is let to a family member)
  • Self Build
  • Self Certified
  • Sub Prime
  • Mortgage Plus

We cannot offer any contractual changes to existing mortgages including Further Advances, Product Transfers, Transfer of Equity or Repayment Term/Type changes. Please note that where the original mortgage was deemed as regulated, the status of the mortgage will never change.

If you have a customer who would like to make a change to their account and their existing regulated mortgage is held with us you have the following options;

  • The customer can contact our Specialist Remortgage Team on 0345 608 0263
  • You can review the whole of market for options for the customer to suit their circumstances to Remortgage to another lender

 Transfer / Purchase of Equity

Top slicing 

 Minimum Top Slicing Qualifying Criteria

  • Portfolio Landlord excluded
  • Let to Buy excluded
  • Minimum income £100k (First 2 applicants)

    • PAYE
    • Self-employment
    • Pension
    • Profit from UK land and Property
  • Minimum stressed 125% RCR – below this, the standard RCR calculation is offered
  • Maximum stressed 145% RCR – Over this, the standard RCR calculation is offered

If a customer is within 6 years of retirement age (anticipated or aged 70 whichever earliest) at the time of application, we can only consider lending on a top slicing basis if they are currently in receipt of an acceptable pension income or they are a joint applicant and the other applicant has sufficient income and is not within 6 years of retirement.

Income and expenditure assessment

Income included in affordability

  • PAYE – basic, commission, bonus, and overtime
  • Self-employment
  • Pension

Income excluded from affordability assessment

  • Other income
  • Profit from UK land and property
  • Benefits

Commitments used to calculate affordability

  • Residential mortgages
  • Loans, credit cards, HP, etc
  • Financial dependents
  • School fees
  • Childcare costs

 Process

What to expect when you submit a Top Slicing application with us

  • Complete the BM Solutions online calculator and calculate standard RCR calculation. If application meets qualifying criteria “Top Slicing” option will be displayed and additional data fields will be available to be completed.
  • The calculator results page will be updated to reflect any new borrowing amount once the top slicing additional data fields have been completed and calculated.
  • Submit application via BM Solutions Online – The system will not ask any additional data for top slicing applications and the system will calculate the lending decision using existing income and expenditure fields.
  • All top slicing applications will require proof of income to be submitted and verified.
  • Should an application have discrepancies between bureau information and what has been keyed additional information may be requested.
  • Any changes to an application, including changes of the valuation, would result in a reassessment and a different amount could be offered, including up to the standard rental cover ratio amount.
  • Once income and expenditure has been verified and successful valuation has been completed and returned an offer will be produced.

 Income and affordability

All sustainable income must be keyed in BM Solutions Online, with all of the income keyed into the system.

All Income evidence must be retained upon which the declaration is being made for the applicant, as evidence on some of the applications maybe requested.

The following Income will be used for our Top Slicing assessment.

Employed

Income Type

Main or Other

Key as

Evidence

Bank Holiday Pay (only if it forms part of basic pay and doesn't inflate income)

Main

Basic Annual Income

Latest months payslips

Basic Salary (including the probationary period of a permanent contract)

Main

Basic Annual Income

Latest months payslips

Bonus (These must not be keyed unless they have actually been paid)

Main

Annual Guaranteed Bonus

Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)

Cash In Hand

Main

Basic Annual Income

Latest months payslip(s) and Bank Statement

CEA (Doctors Excellence Award)

Main

Basic Annual Income

Latest months payslips

Commission

Main

Annual Regular / Guaranteed Commission

Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)

Competency Related Threshold Payment

Main

Annual Guaranteed Bonus

Latest 3 months’ payslips (or for incomes received less frequently than monthly all payslips showing this income for the latest 2 years)

Danger Allowance

Main

Annual Regular Overtime

Latest 3 months payslips

Delivery Supplement

Main

Basic Annual Income

Latest months payslips

Dividends - For Company Director

Main

Self Employed

See Limited Company Director/Shareholder under Self Employed/Contractors section

Employed in a Family Business: If less than 25% invested interest and does not receive dividends or net profit as part of their reward package (Treat as employed)

Main

Basic Annual Income

Latest months payslip(s), and corresponding bank statement(s)

Foster Care Income

Main

Self-Employed

Latest 2 years tax assessments

Holiday Pay (only if it forms part of basic pay and doesn't inflate income)

Main

Basic Annual Income

Latest months payslips

Leave of Absence

Main

Basic Annual Income

Latest months payslips

Living Wage Allowance

Main

Basic Annual Income

Latest months payslips

Long Service Pay

Main

Basic Annual Income

Latest months payslips

Market Supplement

Main

Basic Annual Income

Latest months payslips

Maternity Pay – providing the applicant will return to work on the same terms.

Main

Basic Annual Income

Latest months payslip(s) received prior to commencement of maternity

NHS Banding

Main

Basic Annual Income

Latest months payslips

Nursing Bank (Main Income)

Main

Basic Annual Income

Latest 3 months payslips

Occupational Sick Pay

Main

Basic Annual Income

Latest months payslips

Overtime

Main

Annual Regular Overtime

Latest 3 months payslips

Public Holiday Pay (only if it forms part of basic pay and doesn't inflate income)

Main

Basic Annual Income

Latest months payslips

Stipend (Only acceptable for Clergy)

Main

Basic Annual Income

Letter of confirmation from Religious Order

Tips

Main

Annual Regular Overtime

Latest 3 months payslips

Teaching and Learning Responsibility (TLR)

Main

Basic Annual Income

Latest months payslips

Tronc

Main

Annual Regular Overtime

Latest 3 months payslips

Zero Hours Contract (The customer must have been employed on a zero hours contract for a minimum of 12 months (with the same employer or with different employers but in the same type of work))

Main

Basic Annual Income

12 months' worth of payslips (this applies whether the applicant is paid weekly or monthly and could consist of P60 plus subsequent payslips to cover the full 12 month period)

Pension

Income Type

Main or Other

Key as

Evidence

Armed Forces Independence Payments (AFIP)

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

Fixed Annuity Payments (Private)

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

HM Forces - Guaranteed Income Payment (GIP)

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

Pension Tax Credits

Other

Pension Credit

Latest Bank Statement or Pension Statement

Permanent Health Insurance (PHI) The term must not extend past the final payment date for PHI if affordability is based on this income only

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

Private Pension / Private Widowers Pension

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

State Pension

Other

Pension - State

Latest Bank Statement or Pension Statement

State Widows Pension. (Please see above if Bereavement Allowance).

Other

Pension - State

Latest Bank Statement or Pension Statement

The Thalidomide Trust Income

Other

Pension - Private

Latest Bank Statement (where paid gross) or Latest Pension Statement / Latest months payslip(s) or Pension P60

War Disablement Pension

Other

Pension - War Disablement

Latest Bank Statement or Pension Statement

War Widow(er) Pension

Other

Pension - War Widow

Latest Bank Statement or Pension Statement

Self Employed/Contractors

All self Employed income should be keyed in 'Net Profit' at interview stage to calculate the correct affordability, however it is important to key Turnover and Gross Profit if the Customer has them, if not key '0'.

For Contractors who earn more than £500 per day or £75,000 per annum - Gross value of contract is calculated as daily rate on the contract x 5 days per week x 46 weeks per year (or hourly rate x 7 hours per day x 5 days per week x 46 weeks per year). Unless the contract states the actual hours/days worked are lower in which case use these figures.

Income Type

Main or Other

Key as

Evidence

Contractor - If applicant earns more than £500 per day or £75,000 per annum - providing 12 months or more continuous employment with 6 months of contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Main

Basic Annual Income

Copy of the contract and latest months personal/business bank statement(s) showing the salary credit.

Contracts - Fixed / Short / Temporary - If Company Paying Tax (Excluding CIS contractors) - providing 12 months or more continuous employment with 6 months of the contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Main

Basic Annual Income

Latest months payslip(s)

Contracts Fixed / Short / Temporary - If Customer Paying Tax

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

IT Contractors - providing 12 months or more continuous employment with 6 months of the contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Main

Basic Annual Income

Copy of the IT Contract and latest months personal/business bank statement(s) showing the salary credit.

CIS Contractors - If Company Paying Tax key as employed providing 12 months or more continuous employment with 6 months of contract remaining OR 2 years continuous service (for the last 2 years at the date of the application) in the same type of employment

Main

Basic Annual Income

Latest three consecutive months payslip/invoices (this applies whether the applicant is paid weekly or monthly) and three months corresponding bank statements. P60/Payslips If no income is received or the customer is unable to provide evidence of income then ‘zero’ income

must be used for that month.

CIS Contractors - If Customer Pays Own Tax or has more than one contract or is employed by Ltd company he/she has set up then treat as Self Employed

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Employed in a Family Business Equal to or greater than 25% Invested interest and/or receives dividend or net profit as part of their reward package(Treat as Self Employed)

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary ONLY less than 25% shareholding (Treat as employed)

Main

Basic Annual Income

Latest months payslip(s)

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary ONLY Equal to or greater than 25% shareholding (Treat as self employed)

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary + dividends ONLY Irrespective of share holding (Treat as Self Employed)

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Ltd Company – Director/Shareholder - Wanting to use - Basic PAYE salary + Net Profits ONLY irrespective of share holding (Treat as Self Employed) Note: Net Profits cannot be used without referral to Underwriters

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Self employed - Sole Trader

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Self employed / Share holding of a Non Ltd Company (ie Partnership) Taxable Income

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Partner of LLP receiving profit share as part of their salary package Irrespective of share of equity (Treat as Self employed)

Self Employed

See Self Employed Applicants

Last 2 years Tax Calculations and corresponding Tax Year Overviews

Employee of LLP - not equity shareholding partner. (Treat as employed)

Main

Basic Annual Income

Latest months payslip(s)


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