Lending and Security Guidelines

This page provides guidance for mortgage intermediaries on the areas the West Brom will consider as part of its mortgage underwriting processes.

In addition to the guidelines set out in this page, the West Brom also applies a number of proprietary credit assessment tools, the outcome of which may result in a case being declined despite appearing to fit within the guidelines set out in this page.

The West Brom retains the right to change its underwriting policy at any time and without necessarily updating these guidelines. However, the West Brom will endeavour to ensure the guidelines set out in this page represent the Society’s current approach to lending.

In the event of any clarification being required please contact the Intermediary Sales and Support Team (ISST) or your Business Relationship Manager (BRM). Prior to submission of supporting documentation please contact the BRM for clarification of any items or policy which may require further investigation to ensure cases are processed in a timely manner. 

Please use the search facility below in order to quickly find the information you are looking for from our Lending and Security Guidelines.

Alternatively, you can download a printable pdf of our Lending and Security Guidelines.

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Maximum Loan to Value

  • As specified within the product literature.

  • LTV’s are based on the lower of the Purchase Price or Valuation.

  • Fees may be added to the loan subject to product criteria.

  • Maximum LTV’s are dependent on products and restrictions.

Maximum Aggregated Monetary Loan Limits

  • As specified within the product literature.

Minimum Monetary Loan Limits

  • Subject to product minimum loan limits

Mortgage Types

  • Permitted.

  • Permitted where the refinance will occur 6 months after the original purchase date of the security (registered proprietorship). The maximum LTV is 90% unless otherwise specified below.

  • Subject to purpose qualification:

    • Straight debt up-lift

    • Home improvements

    • Repayment in full of equity loan (Maximum LTV 95%)

    • Business purposes (Maximum LTV 75%)

    • Car purchase/Wedding expenses/Holiday

    • Repayment of first charge mortgage(s) in addition to main residence

  • The following capital raising purposes are excluded:

    • Payment of gambling debts

    • Debt consolidation

    • Payment of taxes

  • Not permitted.

  • A sub-sale occurs when a property is bought and then sold on within 6 months, i.e. the applicant is buying the property from an individual who has themselves bought the property less than 6 months before.

  • Permitted subject to:

    • Property being owned for at least 6 months

    • The seller is a third party and there is evidence of an arm’s length transaction with free title

Mortgage Terms

  • 5 years.
  • 35 years.

  • An appropriate mortgage term is established subject to consideration of:

    • Applicant’s declared retirement age, where the agreed term will fall outside of retirement age or the loan is considered affordable based on post-retirement income. Repayment vehicle (interest only)

    • Remaining lease term and the Valuer’s comments on suitability of the property as security for lending

    • Product specification;

    • Applies to all mortgage applicants.

  • Maximum ≤ 95% LTV.

  • Maximum Term: 35 years.

  • Maximum ≤ 60% LTV Interest Only element.

  • Maximum Term: 35 years.

Repayment Vehicle

  • The evidenced current or projected value at maturity of the policy  must be equal to or greater than the proposed loan amount or account exposure.

  • The evidenced current or estimated pension tax free lump sum must have a value equal to or greater than the proposed loan amount or account exposure

  • Evidence must be no more than 15 months old

  • Permitted.

  • The value of the plan must have at least 50% of the requested ‘interest only’ amount with a plausible investment strategy being demonstrated to cover the full value,

  • The latest statement from the provider is required as evidence and must not be more than 12-months old

  • Must be administered by an FCA regulated Financial Services firm.

  • All beneficiaries of the repayment vehicle must match the name(s) on the application.

  • Permitted

  • Minimum equity of £200,000.
  • Permitted

  • Subject to equity in other UK property is sufficient to repay the interest only part of the mortgage after any mortgage(s) on the other property has been repaid. Excludes commercial properties

  • Evidence required from valuation and latest mortgage statement

  • If the property is unencumbered, confirmation of ownership must be evidenced

  • Not permitted.

Lending Schemes

  • Permitted. Please call the Intermediary Sales and Support team for further information.

     

  • Not permitted.

     

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Permitted. Please call the Intermediary Sales and Support team for further information.

Minimum Age Requirements

  • 21 years.

  • 18 years.

Maximum Age Requirements

  • Loan to be repaid by applicant’s 75th birthday (self/custom build 70th birthday)

  • Subject to affordability including assessment of expected post-retirement income if beyond applicant’s declared retirement age.  

Applicant Type

  • Permitted.

  • A first time buyer application is defined where none of the applicant(s) have had a mortgage (Owner Occupied, Buy to Let or Let to Buy) within the last 3 years

  • Permitted.

  • Permitted where the applicant is evidenced as a UK or citizen of another nation (for example an individual who holds the nationality of an EU single market member country) with automatic right to abode and 3 years’ residential history in the UK immediately prior to application.

  • Lending permitted where the applicant is an expatriate (an individual who is a British National who is not currently residing in the UK) in the following circumstances:

    • The sole applicant is a member of the UK Armed Forces who may be intermittently posted abroad, will not be residing in the UK full time, but where the security property will not be let.

    • The applicant is a member of the UK Armed Forces and the second applicant is a partner/spouse who will continue to reside in the UK full time and within the security property.

  • Lending is not permitted where the applicant is an expatriate (an individual who is a British National who is not currently residing in the UK) in the following circumstances:

    • The applicant is a member of the UK Armed Forces who is not residing in the UK full time as they are intermittently posted abroad and wishes to let the security property.

    • The applicant is either permanently or temporarily working in another country and is not residing in the UK full time.

  • Permitted where the applicant is evidenced as a Citizen who holds indefinite right/leave to remain in the UK, with 3 years residential history in the UK immediately prior to application where the property is for their own use and immediate occupation.

  • Evidence to prove right to remain in the UK, with no restrictions on employment.

  • Not permitted.

Employment Type

  • Permitted.

  • Subject to at least 12 months continuous declared employment history and at least three months with current employer

  • Separate gaps in employment of up to three months, at any one time, are considered acceptable within the 12 month period

  • Professional occupations are permitted if less than 12 months continuous employment or less than three months with current employer. Please refer to the Intermediary Sales and Support team for further information.

  • Permitted

  • Must evidence that applicant has been employed on a similar basis for a minimum of 12 months

  • Income to be based on an average of the last 12 months

  • Not permitted.

  • Permitted.

  • Subject to evidence of 12 months employment on this basis.

  • Income to be based on an average of the last 12 months earnings

  • Applications from ‘professional’ occupations (e.g. doctor, teacher etc. and qualified tradespeople where there is clear future earning potential) permitted where they are entering their first fixed term contract, with no requirement for the 12 month fixed term contract history.

  • Permitted.

  • Subject to 12 months continuous fixed term contract employment within the same skill set

  • New fixed term contract replacing an employed position held in the same skill set

  • Applications from ‘professional’ occupations (e.g. doctor, teacher etc. and qualified tradespeople where there is clear future earning potential) permitted where they are entering their first fixed term contract, with no requirement for the 12 month fixed term contract history.

  • Permitted.

  • Subject to employment confirmed by a qualified external company accountant. Please contact the Intermediary Sales and Support Team for what is deemed a relevant accountant qualification.

  • Permitted.

  • Subject to the applicant declaring their intention to return to work.

  • Affordability should take into consideration future childcare costs.

  • Permitted.

  • Secondary employments outside of the applicants’ primary occupation limited to 50% of the income

  • Where an applicant(s) has multiple employers whilst working within the same skill set we may consider 100% of income and this will be counted as one job

  • A maximum of 2 jobs is allowable.

  • Permitted.

  • Self-employed is defined as a Sole Trader, Partner in a Partnership, LLP or where a ≥ 25% shareholding is held in a Limited Company.

Sole trader or Partner in a Partnership:

  • Subject to the business trading for a minimum of 2 years

  • Income used will be the lower of the latest finalised years or an average of the last 2 years share of net profit

Limited Liability Partnership (LLP):

  • Permitted subject to the business trading for a minimum of 2 years

  • Income used will be the lower of the last 2 years share of net profit

  • May permit less than 2 years, where an applicant has recently joined an LLP providing the business has been trading for at least 2 years

Limited Company:

  • Permitted subject to the business trading for a minimum of 2 years

  • Income will be the lower of the latest finalised years or an average of the last 2 years salary or dividend

  • May permit less than 2 years trading where a sole trader or partnership has changed to Limited Company status providing the business as a sole trader/partnership has been trading for at least 2 years

Income Multiples

  • 4.5 x main income where allowable income ≤ £50,000 p.a.; or

  • 5 x main income where allowable income > £50,000 p.a.

  • 4.5 x main income + 1 x secondary income (where joint allowable income ≤ £50,000 p.a.);

  • 5 x main income + 1 x secondary income (where joint allowable income > £50,000 p.a.);

  • 4 x joint income (where joint allowable income ≤ £50,000 p.a.); and

  • 4.5 x joint income (where joint allowable income > £50,000 p.a.).

Affordability

  • An affordability assessment based on a Capital & Interest repayment method, is required in all instances to support the authorisation of an Offer of Loan.

  • An affordability assessment is considered on the basis of net applicant income and household expenditure.

  • A “household” is considered to be anyone who will be resident in the security property as their main residence and has a financial dependency on the applicant(s).

  • A dependent child is defined as a child who is residing in the security as their main home and ≤ 16 years of age.

  • A dependent adult is defined as anyone who is 17 or older and is residing in the security as their main home and is unable to independently support themselves financially.

  • The Society declines to accept a further application from a sole applicant where they have previously been party to a joint application which failed the affordability assessment.

  • Only income which is allowable under policy and evidenced should be used to assess affordability. 

  • Income from non-applicants cannot be used to assess affordability.

Income Type

  • Permitted.

  • 100% of gross basic salary.

  • Permitted.

  • 100% of monthly overtime. bonus and commission.

  • 50% of overtime, bonus and commission if not paid monthly.

  • Subject to additional income not exceeding 100% of gross basic salary.
  • Permitted.

  • 100% of permanent contractual shift allowance.

  • Permitted.

  • 100% may be considered where evidenced and contractual.

  • Permitted.

  • 100% may be considered where evidenced and contractual.

  • Not permitted.

  • Permitted.

  • 100% may be considered where evidenced.

  • Permitted, further information should be taken from expenditure type - Dependent Maintenance/Childcare costs.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

  • Permitted.

  • Where evidenced and considered sustainable

  • Permitted.

  • Where supported and evidenced 

  • Permitted.

  • Up to 100% of earned pension where evidenced.

  • Permitted

  • Up to 100% of state pension where evidenced

  • Permitted.

  • 50% of the rental income from an unencumbered Buy to Let or Let to Buy property maybe considered within the affordability assessment.

  • Professional landlords (defined by 4 or more properties) may declare a secondary income, derived from business accounts or SA302, received from rental income which will be subject to standard self-employed criteria.

  • Not permitted.

  • Not permitted.

  • Permitted.

  • Income is limited to the lower of the average of the last 2 years’ or the current year.

Expenditure Type based on monthly expenditure used in affordability assessment

  • A deduction covering:

    • Child maintenance, CSA;

    • Nursery, school, college and university fees.

    • To be declared net of any childcare benefit e.g. child tax credit.
  • Actual or expected council tax.

  • A deduction covering:

    • Buildings and contents insurance premiums; and

    • Those termed as essential by the borrower, for example Life Insurance and protection or pension contributions.

  • Average expenditure on food and non-alcoholic drink.

  • A deduction covering:

    • Essential and non-essential travel;

    • Petrol and car parking;

    • Car tax, car insurance and car maintenance;

    • Public transport costs.

  • A deduction covering:

    • Water, gas, electricity and other heating;

    • Telephone – landline and mobile;

    • T.V licence;

    • T.V and internet packages;
    • Ground rent and service charges.

  • A deduction covering:

    • Clothing, footwear, health;

  • Declare all balances on credit/store cards and mail order accounts. Please indicate which items will be repaid at completion.

  • Consider 3% of balance(s) as a deduction where not to be repaid prior to the release of funds
  • Declare all monthly payment(s) where not to be repaid prior to release of funds. 

  • Declare any other mortgage debt which will not be repaid prior to release of funds.

  • Declare any Buy to Let or Let to Buy mortgage debt which will not be repaid prior to release of funds and the monthly mortgage payment on the debt is not ≤ the monthly rental income received (based on 12 monthly payments pa). Only the ‘shortfall’ will be considered as a deduction. 

Impaired Credit

  • A credit search is performed on all applicants.

  • Not permitted where: Arrears on a current or previous secured or unsecured loan within the last 2 years, where the cumulative amount over due at any point reached three or more monthly payments.

    • An applicant has had one or more CCJs registered within the last 3 years, either satisfied or unsatisfied, with a total value greater than £500.

    • An applicant has been subject to an IVA within the last 3 years.

    • An applicant has been subject to a bankruptcy which has been discharged for less than 3 years

  • Not permitted where the applicant has had a property repossessed within the last 6 years.

Deposit Type

  • Permitted.

  • Where amount exceeds the equity in the property by more than the applicant(s) annual salary, evidence required of additional deposit.

  • Permitted.

  • Evidence of savings is required

  • Permitted where from a close family member.

  • Confirmation of the sum being ‘non-repayable’ must be evidenced unless:

    • Protected by a Deed of Trust (or similar) or

    • Registered as a second charge

  • Gift not acceptable where:

    • provided by the vendor (unless an acceptable new build incentive from the builder/developer);

    • provided by someone who is intending to reside in the property

  • Not permitted.

  • Permitted.

  • Subject to evidential requirements 

  • Permitted.

  • Subject to a maximum 5% discount or cashback up to 5% of the security value 

  • Incentives of over 5% are treated as a reduction in purchase price for maximum mortgage and LTV requirements

  • Not permitted.

Processing Evidence

  • Applicants must declare address history for last 3 years.

  • Evidence of residency must be provided at current address.

  • Evidence may be electronically provided by:

    • One active Voters Roll record and one active CAIS record (excluding communication supplier and mail order records) at current address; or

    • Two active CAIS records (excluding communication supplier and mail order records) at current address.

  • Where electronic identification is not possible, please refer to the ‘How to submit business guide’ for a detailed list of our requirements.

  • Where requested evidence of the latest full calendar month main bank statement at least, for all applicants is required.

  • Evidence of satisfactory mortgage payment conduct.

  • Not required.

  • Evidence of all supporting approved income is required.

  • Ways in which income can be evidenced include but are not restricted to:

    • Latest full month’s payslip

    • Latest 3 months payslip’s and P60 (required if overtime/commission/bonus or other income(s) are being used for affordability)

  • Evidence of self-employed income by;

    • Latest 2 years HMRC tax year calculations plus the tax overview documentation

    • Accountants certificate covering the most recent 2 years accounting period and/or

    • Latest 2 years accounts from a suitably qualified accountant

Please note:

  • In all instances the current turnover and trading performance of the business is verified to be in line with the confirmed personal income/net profit.

  • Where the accounting period end on the provided set of personal income/net profit figures is older than 3 months, the last 3 months business trading bank statements should be obtained and considered.

The above information is for guidance purposes and further income evidence may be requested, if required.

Dual Representation

  • A panel solicitor or licensed conveyancer will represent the Society and the applicant within the legal transaction. Costs to be borne by the applicant.

  • The Conveyancing Panel will be managed centrally by LMS.

Separate Representation

  • The applicant will appoint their own legal adviser who will act for the applicant only.

  • A panel solicitor or licensed conveyancer will represent the Society within the legal transaction. Costs to be borne by the applicant.

  • A Form of Security Valuation to have been assessed and evidenced on all offered new advance applications.

First Mortgage Valuation

  • An applicant may choose one of the following forms of valuation:

    • Standard Valuation Report;

    • Home Buyers Valuation Report;

    • Full Structural Valuation Report.

Security Value and Condition

  • Minimum Value £70,000.

  • Minimum Value £70,000.

  • Retentions are not made for amounts less than £2,000.

  • Where the valuer requests a specialist report, all reports should be provided by an approved contractor and evidenced accordingly.

Security Demand

  • Permitted subject to the Valuer confirming the property is suitable security for our Mortgage including:

    • Where there is good demand and the property is likely to rise and fall in line with the general market conditions

  • The location, environmental factors or individual features of the property may cause the value to perform better than market conditions

Security Geographical Location

  • Permitted.

  • Isle of Man and Channel Islands are not permitted.

  • Permitted.

  • Not permitted.

  • Not permitted.

  • Not permitted.

Security Tenure

  • Permitted where security is not a flat or maisonette.

  • Permitted providing no more than 15% (measured against the total floor areas of the building) of the property is affected and where security is not a flat or maisonette.

  • Permitted where  a minimum term of at least 85 years remains on the lease from the start of the mortgage term.

  • Not permitted.

  • Not permitted.

Security Basic Criteria

  • Permitted where Internal WC, Bathroom and Kitchen exists.

  • Permitted where mains service connections exist.

  • May consider where septic tank or private utilities exists.

  • Not permitted where identified within the curtaliage of or influencing distance the property. 

  • Permitted where > 20m from a treated/untreated Mine or Adit and not within security boundary. 

  • Permitted where not designated in ‘Extreme’ or ‘High’ risk flood area.

  • Acceptable, subject to any lease with provision for a periodic increase in the ground rent is capped to a fixed amount or percentage, which can be readily established and is reasonable. 

  • Permitted.

  • New build is defined as a property that has been completed or converted in the last 12 months, or on first occupation

  • Maximum 85% LTV

  • Subject to the following requirements:

    • Property is completed within 12 months of application.

    • Property is built with a warranty. Qualified Architect supervised new builds are permitted where an acceptable building warranty is also available;

    • Off Plan purchases are permitted where completion complies with standard Offer of Loan and Valuation validity period.

  • Acceptable new build warranties:

    • NHBC;

    • Premier Guarantee;

    • Building Life Plans;

    • LABC new build warranty

    • ICW

    • Checkmate Castle 10

    • Buildzone

    • Q Assure Build

    • Global Warranties

  • Permitted.

  • Maximum 80% LTV.

  • Maximum loan £500,000.

  • Interest only permitted in the build stage.

  • Upon completion, build will revert to Capital and Interest Repayment. To remain on interest only the build must comply with standard interest only policy.

  • Not available for property developers.

Security Acceptable Properties

  • Permitted.

  • New build: Maximum 85% LTV.

  • Non-new build: Maximum 95% LTV.

  • Subject to construction, valuation and product availability.

  • Permitted.

  • New build: Maximum 75% LTV.

  • Non-new build: Maximum 85% LTV.

  • Subject to maximum 5 storeys and Society restrictions on maximum exposure to single developments, construction, valuation and product availability.

  • Studio flats are permitted subject to a minimum floor area of 30 square metres.

  • Not permitted.

  • Permitted.

  • New build: Maximum 85% LTV.

  • Non-new build: Maximum 95% LTV.

  • The property must be for the exclusive use of applicants and freely marketable.

  • Please contact the Intermediary Sales and Support team.

Security Unacceptable Properties

  • Not Permitted;

  • Examples of affected properties:

    • Farms and Smallholdings

    • Grade 1 Listed Buildings

    • Agricultural tie or Restricted properties

    • Freehold flats and maisonettes including coach house flats

    • Live / Work Units

    • Mobile Homes / River boats

    • Properties with 10 or more acres of land

    • Purchase of land

    • Low cost housing/restricted resale covenant schemes.

    • Sheltered housing and properties with restricted age for the occupants.

    • Holiday Lets

    • Deck access flats

    • Commercial buildings that have been transformed into residential

Security Construction Type

  • Permitted with Masonry Outer Leaf.

  • Permitted with Brick Outer Leaf.

  • Affected properties; Surebuild

  • Not Permitted

  • Examples of affected properties; B.I.S.F. Atholl, Crane, Cussins, Levett Cartwright, Roften, Denniss-Wild, Thorncliffe, Dorlonco, Trusteel MK 1 and 2, Telford 5M, Howard, Keyhouse Unibuilt, Steam, Asbestos Clad Birmingham Housing.

  • Pre 1990 steel frame is not permitted

  • Permitted. 

  • Affected properties; Wimpey No-Fines, Laing Easiform, Mundic Block, Bryants, Birmingham Wall Frame/Low Rise.

  • Not permitted. 

  • Affected properties; Reema Hollow Panel

Fees and Charges

You can find our valuation fees here.

Definitions

ADV : Advance
BTL : Buy to Let
CAIS : Credit Account Information Sharing
CCJ : County Court Judgment
CII : Consumer Indebtedness Index
COMM : Commission
KFI : Key Facts Illustration
LTV : Loan to Value
RMC : Regulated Mortgage Contract