Compliance Hints & Tips from Christine Newell

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Hints & Tips

Marsden's new background BTL stress rate- 5.5% x 145%. If rental income is in excess of this, Marsden will accept this as usual although if there is a shortfall of rental income, it must be included in affordability.

Saffron Building Society have launched an Interest Only option for professionals, self-employed and contractors. The following outlines the criteria for this product:
  • Maximum LTV 70% (90% inside M25)
  • Minimum age 21
  • Minimum property value £100,000
  • Maximum loan £1,000,000
Acceptable repayment vehicles- Downsizing (minimum £250k equity in property required), midpoint projection of endowment and ISA's, 100% midpoint value of pension and investment portfolios, sale of second property (equity must be equal to requested loan amount)

 Coventry for intermediaries have announced changes to its affordability model which will increase the borrowing capacity available to many prospective clients- try their affordability calculator here.  

Hodge Lifetime are delighted to confirm that with immediate effect, their 55+ interest only mortgage will be available to all relevantly qualified Independent Financial Advisers. The proc fees payable are 0.55% gross and 0.50% net. 

Tip of the week...
A few of you have asked for solutions to  re-mortgaging property that needs minor renovations, such as upgrading kitchen and bathrooms etc. The property needs to be habitable in its current state but Halifax and Nationwide have been able to look at what renovations are needed and offer a mortgage based on retaining some funds equivalent to the works being undertaken. They will ask your client to provide plans and estimates of the work needed and based the lending on the current value and improved value once the renovations have been done. The work will need to be completed to a satisfactory standard then the funds can be released. This can help clients where they are able to get the work completed and then be reimbursed by the Lender’s release of the retained monies. Please discuss individual cases in full with your BDM from Halifax or Nationwide.

Alternatively, this could be classed a self build loan and a lender such as Build Loan could be approached. 
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