To search for an item in the Society's Lending Criteria you can either:

  • Select the category - Residential, Buy to Let etc.
  • You can then:
    • Search for key words - "BTL", "Income", "Self Employed" etc. OR
    • Select the All or First Letter within the alphabetical filter

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People

Age Limits / Lending Into Retirement

Our standard minimum age at the start of the term is 18 years old.

Our standard maximum age at the end of the term is 75 years old for residential lending where the customer is not retired at the point of application or is not borrowing on a Capital & Interest basis.

Where an applicant is Retired at the point of application we will allow a maximum age of 80 years old at the end of the term as long as the mortgage application is on a Capital & Interest basis.

This limit has been set based on a risk assessment of ageing borrowers and also in consideration of our customers best interests. As a result we aim to ensure our customers have options during the mortgage to either remain with Skipton or potentially choose another lender if that is suitable and do not become "trapped borrowers".

Lending Into Retirement:

Evidence of retirement income and any other acceptable retirement income is required to enable the underwriter to take into account the likely impact of retirement on affordability when:

  1. A borrowers age is greater than 70 at the end of the mortgage term.
  2. Where the borrower states an expected retirement age that is lower than their age will be at the end of the mortgage term.

Any retirement income that is being used within the affordability assessment must be received in £Sterling (IOM£ / Gibraltar£ also acceptable) by the applicant. Where concerns exist with regards to affordability, the application will be declined.

CIS Workers

What is CIS Workers (Construction Industry Scheme)

CIS is a HMRC scheme under which if you work for a contractor in the construction industry (so not as an employee) but for example as a self-employed individual, then the CIS rules mean that the contractor is usually obliged to withhold tax on its payment to you. This is different from other self-employed individuals, who normally receive their payments gross, which means no tax is deducted.

CIS is not the same as an independent contractor.

Evidence of Income required is either:

  • 2 year summary of payments from either the employer/s or accountant and 3 months bank statements showing income, or;
  • 2 years SA302s with 3 months bank statements evidencing payments.

To calculate income we will use the latest years income or an average of the last 2 years income, whichever is lower.

Please note 2 years’ worth of weekly remittance slips will not be accepted.

Contractors e.g. IT / Management Consultants (Self Employed)

Evidence of income required:

  • minimum of 6 months contract history with a minimum of 2 years' experience in the same field of work (as evidenced by customers CV)
  • copy of 1 month personal or business bank statements evidencing the contractor income and general expenditure
  • Copy of current contract (with minimum 1 month remaining)
  • minimum annual income (based on daily rate) of £50,000.

To calculate income we will use daily rate x 5 x 48 (weeks) irrespective of whether operating as a Sole Trader or through a Ltd company. Where there are gaps in the employment history the income calculation will be pro-rata (e.g. 8 week gap: income=5x40 weeks).

When completing the application on our eMortgages system, you will need to enter your client's daily rate x 5 x 48 weeks as employed income rather than self-employed income.

Any income being used within the affordability calculation and/or to make the monthly mortgage payments must be received in £Sterling by the applicant.

Credit Search / History

The Society uses Experian for its credit searches. You can find more information on our Credit Scoring Guide.

A full Credit Search is required for each applicant.

The Society’s policy on Credit Performance and Credit History is as follows:

Credit Defaults

The following is acceptable (subject to overall ‘score’) and providing all other conditions are met:

  • 1 default recorded of less than £200
  • The default was registered more than 12 months ago
  • The default is now satisfied (as evidenced on the credit file)

The following is also acceptable (subject to overall ‘score’) and providing all other conditions are met:

  • No more than 2 defaults recorded per applicant and no defaults in the last 3 years
  • Total value of the defaults does not exceed more than £3000 per applicant
  • All defaults are satisfied at the time of application (as evidenced on the credit file)
  • There are no missed payments on any account in the last 6 months
  • The application LTV is less than 80%

Please note: We do not accept defaults on certain lending segments including Help to Buy and other government schemes, Discount Purchases, and Debt Consolidation cases.

County/High Court Judgements

The following is acceptable (subject to overall ‘score’) and providing all other conditions are met:

  • 1 CCJ less than £500 registered in last 3 years, now satisfied
  • 2 CCJ’s up to a total value of £2000 where the latest CCJ was registered more than 3 years ago, now satisfied

Bankruptcy/IVA

The application can be considered where:

  • Any Bankruptcy/IVA has been discharged at least 3 years ago
  • Applicant is within limits on all revolving/flexible credit lines
  • There are no arrears on any account within the last 6 months

Mortgage and Secured credit Arrears

  • Applications with any mortgage or secured arrears in the last 6 months will be declined
  • Applications with mortgage arrears of more than 2 months in last 2 years will be declined

Unsecured Loan missed payments/credit card/store cards

The application will be declined if:

  • There are more than 2 missed payments on any account in last 6 months
  • There are more than 2 missed payments on any loan within the last 2 years
  • If any account is currently 1 month in arrears (where total balance of accounts is greater than £100)

Bank Account conduct

The application will be declined if:

  • Overdraft limit has been exceeded within the latest month
  • Credit Bureau report status 1 or worse is reported on any bank account within latest month
  • Credit Bureau report status 2 or worse is reported on any bank account within latest 6 months

Credit limits

  • If any credit line is reported as over the limit at the time of the search the application will be declined

Payday loans

  • If any Payday loan has been used within the last 2 years the application will be declined

Debt Management programmes

  • If any accounts are or have been subject to a debt management programme the application will be declined
Financial Dependants

Definition of Financial Dependants:

Dependants are defined as any person (excluding partners) who is financially dependent on the mortgage applicant(s)

Dependents consist of:

  • Dependent Adult - aged 18 years and over and financially dependent on the applicant(s)
  • Dependent Child - aged less than 18 years and financially dependent on the applicant(s)

In addition for the purposes of clarity:

  • These definitions are applicable to both non-BTL and BTL applications
  • Partners are excluded as such information is captured elsewhere as part of the affordability assessment
  • Where an applicant has advised maintenance is being paid for dependants not residing in the property, these persons should be excluded, to avoid duplication in the assessment

The following are not financial dependants - any occupants of a property who are:

  • Self funding (e.g. retired parents with adequate pension income)
  • In full time employment with an adequate level of income

If there is any element of financial dependency then the individual should be regarded as a dependant (e.g. if at university and either fully or partially reliant on parent(s). This includes fostered children).

First Time Buyers

A first time buyer is defined as someone who has never held a mortgage.

For joint applications all applicants must be first time buyers for the application to be classed as a first time buyer case.

  • Minimum 6 months continuous employment
  • Maximum Term 40 years
  • Capital and Interest only
Fixed Term Contract (Employed)

Normal affordability rules apply subject to the following criteria:

  • 2 years history in the same line of work and at least 1 year in contracts
  • copy of the current contract must have 1 month remaining and a copy of the CV is required
  • latest 1 months bank statements evidencing the contract income and also all household bills/personal credit
  • main residence for their own occupation.
Foreign Nationals

The Customer must be either a UK or EEA Citizen or have indefinite leave to remain in the UK to use their income within the affordability assessment for LTV over 75%. If we are not using their income for assessment, then the LTV restriction does not apply.

European Econimic Area Citizens

Applications received from EEA citizens are acceptable subject to the following:

  • Applications received from EU citizens will need to provide evidence of settled/pre settled status, to do this the applicant will need to provide a share code (which can be obtained from the Government website) which can be used by the Society to view their immigration status online.
  • British and Irish citizens, or those with indefinite leave to remain and enter the UK, do not need to provide evidence of settled/pre settled status.

Non-UK or Non-EEA Citizens

  • The Applicant must evidence pre-settled/settled status under the EUSS, permanent right of residency or indefinite leave to remain in the UK
  • Standard income and affordability policy apply.

Applicants on a VISA

Applicants on a Visa are generally acceptable and income may be used in the affordability calculation subject to the following:

  • Minimum 1 year of residency in the UK
  • Maximum of 75% LTV
  • Minimum of 2 years remaining on the visa*.

*In cases where the remaining time on the visa is less than 2 years, we may be able to consider the application. Please contact either your BDM or the Broker Support Team to discuss the circumstances further.

Please note:

  • A copy of the visa page from the Applicant’s passport will be required to evidence the status of all non-UK applicants
Foster Carers

Foster carers do not have to register as self employed or fill in tax returns unless they exceed the qualifying amounts. This can be confirmed at www.hmrc.gov.uk.

To evidence income we require the Local Authority Foster carer provider to complete a letter confirming the applicants income for the last two years and this to be evidenced on the latest three months bank statement. The Society may request this information directly with the Local Authority carer provider should the information not be available on submission.

Foster children should be input as Financial Dependants

Guarantors

Guarantor applications are not acceptable.

ID Verification

Existing customers (active mortgage or investment account)

It is not necessary to verify personal identification again, but current address I.D. is still required. If the applicant is not currently registered on the Voters Roll, then an item of address verification will be required.

New customers

As part of the submission process, electronic Identity checks will be carried out. In the event that these check are unsuccessful, you will be asked to provide identification documents for the customer.

For new applications we require, one item of personal I.D. and one piece of address verification (same document cannot be used for both, i.e. a driving licence is acceptable for either personal OR address I.D.).

Acceptable Personal I.D

  • Current signed passport
  • Current UK full or provisional photo-card driving licence
  • Current full (not provisional) UK (old style, paper based) driving licence
  • Current full EU photo-card drivers licence
  • HM Revenue & Customs Tax Notification
  • Evidence of entitlement to state benefit, pension, tax credit etc.*
  • I.D. cards**
  • Signed firearms certificate
  • Uk residence permit

*These items should no more than 3 months old

**Foreign Identification: See foreign ID section.

Acceptable Address I.D

  • Utility Bill (mobile phone bill NOT acceptable)
  • Council Tax Bill for current billing year
  • Current UK full or provisional photo-card driving licence
  • Current full UK (old style, paper based) driving licence
  • Bank or building society statement showing address*
  • Annual mortgage statement for current year
  • Evidence of entitlement to state benefit, pension, tax credit etc.*
  • Official letter from a government agency, e.g. CSA, DVLA, HMRC, JobCentre Plus, NHS*
  • Care Home letter signed by an appropriate authority
  • Council Tenancy Agreement
  • Court appointment instruction (e.g. probate or Court registered Power of Attorney)

* Where possible, these items should be no more than 3 months old.

Please note, for an item submitted from the Personal ID list, the same item cannot also be used to confirm Address ID.

Foreign Identification

Non UK Passport

  • Passport must be verified by the Society Financial Crime Team
  • Passport can be certified by SBS colleague only

Non UK Driving Licence (Issued by EU member state after 19th Jan 2013)

  • Passport can be certified by SBS colleague or regulated intermediary

Non UK Driving Licence (Issued by EU member state below 19th Jan 2013 or by non EU member)

  • Passport must be verified by the Society Financial Crime Team
  • Passport can be certified by SBS colleague only
Identity Card
  • Passport must be verified by the Society Financial Crime Team
  • Passport can be certified by SBS colleague only
Residency Permit
  • Passport can be certified by SBS colleague only
Income (excluding Self Employed)

Where employed, applicants must be in continuous employment for at least 6 months (including First Time Buyers)

Loan to income calculation

Applications where the loan to income calculation exceeds 5 (acceptable) income, the application will be declined.

We accept 100% of:

  • Permanent basic income
  • Contractual Income (any other contractual guaranteed income e.g. Car/Shift Allowance, London Weighting etc.)
  • Regular Variable Income (bonus/overtime/commission)
  • Working family tax credits/benefits. See Benefits section for more information
  • Pensions (evidence required)
  • War Widow’s/Widower’s Pension
  • Maintenance – where backed up by either a court order or 3 months bank statements showing the maintenance
  • Universal Credits (excluding Housing Benefit element)
  • Disability Living Allowance/Personal Independence Payment
  • Industrial Injury Payments (covered by a Court Order for life or until retirement)
  • Rental Income (Profit from UK land and property)

We accept 50% of:

  • Non-regular Variable Income (bonus/overtime/commission)
  • Second job

Regular variable income, we will now only require 12 months' worth of evidence and we will accept up to 100% towards your client’s income calculation. For example: if your client receives a quarterly bonus, where a similar amount is received every quarter, this can be verified with 12 months' worth of evidence (such as their latest P60 and latest payslip showing the income), and 100% can be used.

Non-regular variable income, we will require two years’ worth of evidence and we will accept 50% towards your client’s income calculation. Or 100% may be accepted where it is established that the income is sustainable. For example: if your client receives overtime, but the amount and occurrence is irregular, we require two years of evidence (such as their two latest P60's and their latest payslip showing the income), and 50% can be used. Or: if your client receives sales commission, which is seasonally impacted and therefore isn't regular, we require two years' of evidence (such as their two latest P60's and their latest payslip showing the income), and 100% can be used, where the evidence demonstrates sustainability.

Any income being used within the affordability calculation and/or to make the monthly mortgage payments must be received in £Sterling by the applicant.

Rental income

We will accept 100% of profit from UK Land & Property as additional income for Residential applications.

We will require:

  • Latest 2 years SA302s
  • Latest months evidence of rental income (i.e. bank statement or invoice from letting agent)

Benefits

Universal credits (excluding any current Housing Allowance element), Working Family Tax Credits, DLA/PIP and Child Benefit are acceptable, providing we have either the last three months bank statements evidencing the benefits or the benefit documentation (where the benefit income is Universal Credits the last three months benefit documentation is required) and the latest months bank statement provided. We will not accept any other type of benefit income.

Child benefit will be accepted where the total gross income of each applicant is no more than £50,000. Where the total gross income of any applicant is over £50,000 we will not accept child benefit for underwriting purposes.

Where acceptable benefit income is greater than the total acceptable earned income the benefit income will be capped at the earned amount.

Parental leave

We require a letter from the employer confirming the agreed return to work date, together with the salary details. On the basis that the applicants return to work date is confirmed by the employer then the confirmed salary can be used in the income calculation.

Nurses

For a nurse, the 6 months continuous employment period starts from when they become qualified and in employment, not from when they began working on the wards and earning a bursary.

Pay rises

For applicants with a pending pay rise we require a letter from their employer confirming the date of the pay rise together with details of the new salary. The pay rise must be provided by the same employer and be effective within 3 months of the date of the employers letter. The confirmed increased salary can then be used in the affordability assessment. In instances where concerns exist with regards to the validity or reasonability of the pay rise, the underwriters may determine that the case cannot proceed until the pay rise has come into effect.

Statutory sick pay

Statutory sick pay can be included within the overall acceptable income provided that this does not amount to more than 25% of the overall monthly income, as evidenced via the latest payslip.

Zero income contracts

In cases where the applicant is on a zero income/hours contract the latest months’ payslips and the last two P60’s are required. An average of the figures on the last two P60’s will be used if increasing or latest year if decreasing. If income has reduced significantly over the last two years the case will not proceed.

UK nationals working overseas

Where an application is received from a UK national working overseas, the following criteria must be met:

  • income must be evidenced via UK HMRC documentation for a minimum of 1 year (e.g. SA302, P60)
  • a minimum 2 years history in the same line of work is required
  • dependents of the applicant must reside in the property full time
  • applicant must maintain residency rights in the UK
  • any income being used within the affordability calculation and/or to make monthly mortgage payments must be received in £sterling by the applicant (IOM£/Gibraltar£ are also acceptable).
Medical Professionals and Teachers

Medical Professionals and Teachers

For Medical professionals and Teachers where they are providing locum or supply work (including bank Nurses) we will require the following:

  • Minimum of 2 years in their chosen profession
  • Copy of current contract (where available)
  • Copy of latest month’s bank statement.

If their contract includes a day rate then to calculate income we will use daily rate x 5 x 48 (weeks). Where there are gaps in the employment history the income calculation will be pro-rata (e.g. 8 week gap: income=5x40 weeks).

If their contract does not include a day rate then the following documentation will be required to evidence income:

  • 3 months invoices or payslips.

To calculate income we will use an average of the last 3 months payments.

There is no minimum income requirement for medical professionals and supply teachers.

Professional Sportspeople

The mortgage term is limited to the sportspersons 35th birth year, unless they can provide evidence of their earning potential (e.g. via appropriate coaching badges etc.) after this time.

UK Sport Lottery Funds are generally not acceptable, although exceptions may be considered if the earning potential post playing career is comparable to the level of funding.

DLA/Universal Credit are generally acceptable (as they are likely to be long term funding).

Self Employed / Limited Company

Definition of self employed: An individual who operates a business or profession as any of the following:

  • Limited company - with a shareholding of 20% or more
  • Limited Company – where shareholding is less than 20% but dividends make up the majority of income
  • Sole Trader or Partner in a Partnership
  • Limited Liability Partnership
  • Independent contractor or consultant.

Limited Companies

Evidence of income required is either:

  • Fully completed Accountant Certificate and 3 months business bank statements, or;
  • Latest 2 years' full accounts and 3 months business bank statements, or;
  • Latest 1 year's full accounts and 2 years' SA302s and 3 months’ business bank statements.

To calculate income we will use the latest years remuneration and dividends or an average of the last 2 years remuneration & dividends, whichever is lower.

If net profit over the last 2 years has significantly reduced or increased, we will examine the reasons why and may request more information if required.

Sole Trader or Partner in a Partnership

Evidence of income required is either:

  • Fully completed Accountant Certificate and 3 months business bank statements, or;
  • Latest 2 years' full accounts and 3 months business bank statements, or;
  • Latest 1 year's full accounts and 2 years' SA302s and 3 months business bank statements.

If no accountant, or accountant is not certified or chartered, we may accept:

  • Latest 2 years' SA302s and 3 months’ business and/or personal bank statements.

To calculate income we would then use the latest years net profit or an average of the last 2 years, whichever is lower.

If net profit over the last 2 years has significantly reduced or increased, we will examine the reasons why and may request more information if required.

Limited Liability Partnership

Evidence of income required is either:

  • Fully completed Accountant Certificate and 3 months business bank statements, or;
  • Latest 2 years’ full accounts and 3 months business bank statements, or;
  • Latest 1 year’s full accounts and 2 years’ SA302s and 3 months business bank statements.

If the applicant is a partner in a large regional or national professional partnership, we may accept an employment reference from a senior partner or practice accountant, showing the applicant's share of profit.

If your client is unable to obtain 3 months business bank statements (e.g. the other partners are unwilling to release these) we may accept three months personal bank statements evidencing income from the LLP.

To calculate income we will use the latest years share of profit or an average of the last 2 years, whichever is lower.

If net profit over the last 2 years has significantly reduced or increased, we will examine the reasons why and may request more information if required.

We will consider applications where the applicant has moved from sole trader to LLP, subject to a full income assessment and meeting the above criteria.

Independent Contractor or Consultant

For further details please refer to Contractors section.

Points of note for all self employed applications:

  • Where net profit has been materially influenced by receipt of the government support schemes/grants and where the increased profits are not deemed to be sustainable upon expiry of the support scheme/grant – then the income may be assessed based upon the 2019/20 accounting position. Alternatively, the income derived from the support schemes may be removed from the latest figures
  • We will only accept finalised full (not draft) accounts. However, if only micro-entity and/or abbreviated accounts are available then a fully completed Accountants Certificate is required
  • All accounts should be completed by a qualified Accountant
  • Accountant Certificate to be completed for each business and each applicant if joint application
  • Accounts/SA302’s must be dated within 18 months of the application
  • We will only accept SA302s marked as “100% complete/submitted”. We will accept either HMRC originals or online printed copies
  • Where SA302s are not printed directly from the HMRC online self-assessment portal, or the SA302 does not carry the customer’s name then a copy of the customer’s Tax Year Overview will be requested
  • Where being used as part of the income calculation, if the net profit has significantly increased or reduced, we will examine the reasons why and may require more information if required
  • Any income being used within the affordability calculation and/or to make the monthly mortgage payments must be received in £Sterling by the applicant
  • For all applications, all the information provided will be fully assessed by an underwriter and their decision will be final.

Acceptable Accountants Qualifications

For the full list of acceptable accountants qualifications see our Accountant Certificate.

All accounts must be signed either by the individual accountant or in the company name in order for them to be acceptable.
Umbrella Companies

An Umbrella Company is a company that has been set up for the sole purpose as to act as an employer.HM Revenue & Customs classify people employed via Umbrella Companies as employed. For mortgage purposes we would classify as self employed.

A contract may be for different lengths of time and via different Umbrella Companies but the total length per company and / or site must not exceed the 24 months. If employment exceeds 24 months for the same company and/or site then the position is classified as permanent.

Documents required to evidence the gross income are all of the below:

  • 2 years history in the same line of work and at least 1 year evidence of operating via the Umbrella Company or 1 year's evidence of contracting
  • 1 month personal or business bank statement
  • latest payslip
  • copy of CV and copy of the current contract with 1 month remaining

Policy

Affordability

The affordability model estimates household expenditure so the mortgage payment under stressed interest rates has to be less than or equal to the Effective Disposable Income (EDI). Any applications not meeting this criteria will be declined.

Any income (employed or self employed) being used within the affordability calculation and/or to make the monthly mortgage payments must be received in £Sterling by the applicant.

At DIP stage the affordability assessment is based on the commitments declared. All current outstanding loans & credit commitments must be declared, any not disclosed may potentially affect the affordability assessment at full mortgage application stage (FMA) and may result in the application being declined.

The following must also be confirmed;

  • maintenance / child support
  • tuition fees
  • nursery/childcare costs
  • rent (where remaining on completion)
  • service charge
  • ground rent
  • shared ownership rent
  • estate rentcharge.

The affordability model includes an element for pension contributions. However, if you believe that the customer is paying into a scheme where you would deem the payments to be higher than standard and they are unable to opt out, please highlight this on the DIP as per the first bullet point below.

In addition, the following must be disclosed at DIP stage:-

  • Details of any other outgoings, regular or otherwise which are likely to affect the ability to meet the monthly mortgage payments
  • Details of any potential changes to income now or in the foreseeable future that are likely to affect the ability to meet the monthly mortgage payment

To carry out an assessment of income and expenditure to establish the maximum that can be borrowed using our online Affordability Calculator.

Capital raising for Debt Consolidation

Capital Raising for Debt Consolidation is not allowed and any requests will be declined.

Choosing a Solicitor

If the conveyancer the borrower chooses is on the Society’s panel, we will instruct them jointly.

If the conveyancer the borrower chooses is not on the Society’s panel, the Society will instruct a separate conveyancer to act for it, and two sets of costs may be incurred, for which the borrower will be liable.

The Society does not allow separate representation except where we have instructed our own solicitor to act for the Society. This is in line with the CML Handbook which states: Our instructions are personal to the firm to whom they are addressed and must be dealt with solely by that firm. The conveyancer must not subcontract or assign our instructions to another firm or body, nor may they accept instructions to act for us from another body. If this requirement is not complied with, it may result in the offer being withdrawn until proper instructions from the Society can be given to it’s own chosen firm or body.

Direct Debits
It is a condition of our Mortgage Offer that mortgage payments are made by Direct Debit, in line with the Direct Debit Guarantee.

The Direct Debit payment will be requested by the Society from the customer's nominated bank account on the 1st of the month however the payment may not debit the customer's bank account for up to 3 working days afterwards. This is due to the time it takes for the Direct Debit to be processed after the Society has requested the payment and instances where the 1st of the month falls over a weekend and/or a bank holiday.

Whilst the direct debit payment may not debit the customer's account for approximately 3 working days after the payment date it is important that the customer has sufficient funds in their account from this point.

Family Discounted Purchase

A family discounted purchase, is where the applicant purchases a property from a family member for a discount, of which we may lend up to 100% of the purchase price. LTV is restricted to individual product maximum and is calculated on the loan as a percentage of the open market value.

A family member is as per the Family Law Act (1996).

  1. the father, mother, stepfather, stepmother, son, daughter, stepson, stepdaughter, grandmother, grandfather, grandson or granddaughter of that person or of that person’s spouse, former spouse, civil partner or former civil partner, or
  2. the brother, sister, uncle, aunt, niece, nephew or first cousin (whether of the full blood or of the half blood or by marriage or civil partnership) of that person or of that person’s spouse, former spouse, civil partner or former civil partner, and includes, in relation to a person who is cohabiting or has cohabited with another person, any person who would fall within paragraph (a) or (b) if the parties were married to each other or were civil partners of each other.

The Society can consider applications for simultaneous home improvements providing the loan does not exceed 75% of the open market value (as confirmed by the Society’s valuer).

First Homes England Scheme

The First Homes England scheme allows first time buyers, where eligible, to purchase a qualifying property with a discount of 30%, 40% or 50% on full market value. The discount is determined by the local authority based on local need – so higher discounts may be needed more in high property value areas.

To qualify for the scheme the household income must not exceed £80,000 (£90,000 in Greater London). The local authority may set a lower income cap if they can evidence that this is needed.

The local authority may also apply a local connection test based on residency, employment in the local area, family connections or special circumstances such as caring responsibilities. They may also prioritise key workers, (as defined by the local authority), for the scheme.

The First Time Buyers will also need to have a mortgage (or home purchase plan) in place for a minimum of 50% of the discounted purchase value.

Maximum property value (after the discount is applied) is £250,000 (£420,000 in London). The price cap only applies to the initial sale of a new build property and not to future sales in the second-hand market.

The discount is maintained on the property in perpetuity, so when the property is sold on it will be sold with the same discount and on the same terms as the original sale, allowing the next first homes customer to benefit from the discount.

For more information on the First Homes England Scheme, please visit OwnYourHome.gov.uk.

Key Points

  • The First Homes Scheme is only available in England
  • First time buyers only are eligible
  • New build houses and flats are acceptable up to 95% LTV
  • New build incentives less than or equal to 5% are acceptable up to 90% LTV on houses and flats
  • The LTV is based on the loan amount and the purchase price (discounted amount)
  • Products available are specifically for First Homes England applications and not available for standard new build applications
  • Applications must be submitted as a Standard Purchase and not a Discounted Purchase
  • All First Homes applications will receive a standard valuation, (they are excluded from AVM & Desktop)
Gifted Deposit

If some or all of the funds being provided towards the purchase of the property are not being provided directly by the borrowers and it has been indicated this is by way of gift, full details must be provided at application stage prior to a decision to lend.

Skipton Building Society do not accept gifts from a person who is or will be a non borrowing occupier of the property to be mortgaged. A gifted deposit declaration is required, signed by the giftor.

Gifted deposits from a non UK source may be acceptable where 6 months bank statements or savings trail from a UK bank or deposit taker is evident for the source of these funds, up until the point of the gift being received by the applicant.

Skipton Building Society accepts gifts only from relatives (Family Law act definition, 1996) which include;

(a)The father, mother, stepfather, stepmother, son, daughter, stepson, stepdaughter, grandmother, grandfather, grandson or granddaughter of that person or of that person's spouse, former spouse, civil partner or former civil partner,or

(b) the brother, sister, uncle, aunt, niece, nephew, or first cousin (whether of full blood or of half blood or by marriage or civil partnership) of that person or of that person's spouse, former spouse, civil partner or former civil partner and includes, in relation to a person who is cohabiting or has cohabited with another person, any person who fall within paragraph (a) or (b) if the parties were married or civil partners of each other.

Help To Buy

Scheme Qualifying Rules:

  • Maximum 40 year term (unless prior approval obtained from the Agency)
  • Maximum Purchase Price under the Help to Buy Scheme Rules:
    • England - £600,000
    • Scotland - £250,000
    • Wales - £250,000
  • The full purchase price must be no more than the full market value for the property. SBS valuation report must value up to the full purchase price otherwise the application will be declined
  • Loan to Income calculation: on Help to Buy applications where the loan to income calculation exceeds 4.5 x (acceptable) income, the application will be declined.
  • Additional Borrowing only acceptable if the applicant wishes to raise additional funds to pay off the equity loan – consent must be obtained from the Agency. Loans for capital raising or home improvements are likely to be declined, can only be considered with Agency approval.

The Society requires that you provide evidence of the following at full Mortgage Application stage:

  • Evidence of the applicants deposit must be provided

Offer Validity

Offer extensions may be permitted. Where the original offer period (6 months) has expired, an extension of a further 6 months may be granted provided that completion of the build will take place within this time.

Where an offer extension to 12 months is agreed, a supplementary credit check and affordability assessment will be carried out after the initial 6 month period (with no extra cost to the customer).

Offers will not be granted after 6 months where there is a materially adverse change in;

  • the quality of the application,
  • the customers financial circumstances (ability to repay) or

If. after 12 months from the date of the original offer, the property build is not completed then the offer lapses. We will then consider a new application.

Porting Applications

The below relates to existing SBS customers only carrying out a Help to Buy purchase porting existing residential products.

  • Where porting and not topping up with a HTB product, a standard valuation report is required and any fees would be payable by the applicant.
  • Where porting and topping up with a HTB product, a standard valuation report is required and customer may be entitled to free standard valuation as dictates by the HTB product selected.
Home Improvements
  • No set LTV or loan amount restrictions. Max LTV & loan amount is dictated by the product maximum and the application score. Refer to the Maximum Loan To Value section for full criteria.
  • Estimates are required for all home improvements where the LTV exceeds 75%.
  • Home Improvements, where the current LTV exceeds 75%, we will insist on a re-inspection of the property prior to the funds being released. In addition, if for major improvements, evidence of planning permission will be required.

Where additional borrowing is taken and is not to cover major building works or adding material value to the property, underwriters have discretion regarding the release of funds without the need for a re-inspection.

Incentives

Definition of Incentives:

  • Builders may offer sales incentives to potential buyers to encourage them to purchase their property.
  • An incentive is anything the builder gives or provides to the buyer in cash or goods. Typical examples are deposits (i.e. builders deposits) paid before completion and cash paid after completion - often to pay stamp duty or legal fees.
  • As all incentives must be paid for by the builder, they can be regarded as a less transparent alternative to reducing the sale price.

Assessment of Incentives

  • Incentives up to a maximum of 5% are permitted, this applies to new build properties only
  • Any application where the incentive value exceeds 5% will be a decline, regardless of LTV
  • Where any incentive applies the maximum LTV available will be reduced by 5%
  • Where the incentive is lower than 5% the maximum LTV available will still be reduced by 5%. For example: The maximum LTV we allow for a New Build flat through the Shared Ownership scheme is 95%. If the property had an incentive provided by the Builder of 2% the maximum LTV allowed in this example would reduce to 90%
  • The Customer must be able to provide a minimum of a 5% deposit (a Builder deposit can be accepted in addition to this but not in place of the customer’s own deposit).

Evidence

All incentives must be declared at DIP stage. The UK Finance Disclosure of Incentives form (formally CML incentive form), which provides details and the value of any incentives, is required by the valuer and forms an integral part of valuing new build properties. This form will be obtained by the valuer/conveyancer.

  • The Valuer will take any incentives into account when preparing the valuation report. Please note that all lending is always subject to a satisfactory valuation for mortgage purposes
  • The Society will use the lower of the valuation or purchase price
  • Evidence of the deposit may be requested at application stage.

The Society does not accept applications where:

  • The builders/vendors are paying above market value for a part exchange property.
  • Applications that have any form of Vendor deposit funding.
Interest Only

Interest Only is acceptable for mortgages and remortgages (except first time buyers)

Maximum LTV

  • Maximum LTV for Interest Only is 70%
  • Maximum LTV for Part Interest Only and Part Capital & Interest is 80% (Interest Only Part restricted to 70% LTV.
  • Applications over 80% LTV must be taken on a Capital & Interest basis

Minimum Income

  • Minimum income for interest only is £40,000 acceptable gross income for sole applications.
  • For joint applications minimum income requirements are; either £40,000 acceptable gross income for main income earner or collective £60,000 gross joint acceptable earned income.
  • This applies to any repayment type where there is an element of interest only.

Max Terms

  • Maximum term for interest only and part and part is 25 years
  • First time buyers must be on C&I with a maximum term of 40 years

Acceptable Repayment Strategies

The Society will only enter into a regulated mortgage contract, where all or part of that contract is on interest-only basis if the customer can provide evidence that a clearly understood and credible repayment strategy is in place and as far as it is reasonably able to assess at the time of underwriting, the repayment strategy has the potential to repay the capital borrowed and that this will be in £Sterling (IOM£ / Gibraltar£ also acceptable).

Acceptable Repayment Strategies are:

Endowment policy provided by a regulation firm

The latest annual statement must be provided as evidence that the sum due to be paid on maturity based on the “medium” projection is equal to or in excess of the proposed amount of mortgage borrowing. The policy is not deposited with or assigned to the Society

Customer Assets

Evidence must confirm that the value of the assets at the time of underwriting is equal to or in excess of the proposed amount of mortgage borrowing.

Acceptable assets are:

  • Equity in a UK property. Where the main residence is being used as the repayment vehicle the maximum LTV for the interest only element is 50% and a minimum of £300,000 of equity must be remaining in the property after the total advance. Where the overall loan is above 50% LTV, additional repayment vehicles can be used in conjunction with Sale of Mortgaged Property
  • (i)(ii) Pension – up to a maximum of 15% of the customer’s total projected pension pot is permitted based on the “lower” projection, where the minimum projected value of the pension pot is £400,000
  • UK shares and bonds held as investments (including Sharesave schemes and Premium Bonds)
  • Cash savings in a UK deposit account

BTLs owned in the applicants name are acceptable.

Pension cannot be used as an acceptable repayment strategy if used as part of the income assessment.

Personal Savings

Savings must be personal and not business related.

Unacceptable Repayment Strategies

The following repayment strategies are unacceptable for new lending:

  • Lump Sum repayment
  • Expected inheritance
  • Bonus income
  • Regular overpayments
  • Equity in a commercial property
  • BTLs owned in a company name
  • Business related savings
  • Second home where a dependent relative resides
  • Joint Borrower Sole Proprietor (JBSP) Cases - If on an Interest Only basis the non-proprietor’s residence cannot be the repayment vehicle
  • Where the asset is held in or is coming from a foreign country/source (assets from IOM£ and Gibraltar£ are acceptable)
Joint Borrower Sole Proprietor

The Joint Borrower/Sole Proprietor proposition is aimed at supporting borrowers whose income is outside of affordability. This means that the supporting borrowers (non-proprietor's) salary can be used to support lower incomes, without co-owning the property (being named on the mortgage deeds).

Permitted for residential lending only. Applications are not permitted on Buy To Let, Discounted or Family Purchase, or in conjunction with any other type of specialist lending, (e.g. Shared Ownership, Right To Buy, Help To Buy)

Maximum LTV 95%.

Independent Legal Advice is required for all non-proprietors.

For applications where the term takes any applicant into retirement - standard lending into retirement (LIR) policy applies.

Maximum of four applicants. Where there are more than two applicants, supporting borrowers can reside in different households.

Applications would generally be expected on a capital repayment basis. However, where the requested repayment method is interest only, sale of the non proprietor's residence will not be accepted as a repayment vehicle.

While both/all borrowers on the application are classed as SBS members, only the first names applicant is classed as a member with full voting rights.

Loan To Income (LTI)

Maximum Loan to Income (LTI) limits are as follows:

  • Income <= £40k or LTV >90%: Maximum LTI = 4.49
  • Help to Buy and Shared Ownership: Maximum LTI = 4.5
  • LTV>85% or Income <= £80k or any element of Interest Only: Maximum LTI = 4.75
  • All other residential lending : Maximum LTI = 5
Loan To Value (LTV)

Maximum Loan To Value

Maximum Loan Amount Maximum LTV
Up to £600,000 95%
£600,001 - £800,000 85%
£800,001 - £1,000,000 80%
Above £1,000,000 75%
Application Types Maximum LTV
Help To Buy 85%
Right To Buy 90%
LIFT 90%
Discounted/Tenant/Family Purchase 95%
Let To Buy - Residential 95%
JBSP/NOBs 95%
Purchase 95%
Shared Ownership (Purchase, Remo & AB) 95%
Remortgage Maximum LTV
No Additional Funds 90%
Home Improvements/Staircasing*/Transfer of equity 90%
Any Other Capital Raising 75%

*Remortgage where capital raising to staircase to 100% ownership (Ex Shared Ownership) Houses – 95%

*Remortgage where capital raising to staircase to 100% ownership (Ex Shared Ownership) Flats– 90%

Additional Borrowing Maximum LTV
Home improvements/Staircasing* 90%
Any Other Capital Raising 75%

*Additional Borrowing where capital raising to staircase to 100% ownership (Ex Shared Ownership) Houses – 95%

*Additional Borrowing where capital raising to staircase to 100% ownership (Ex Shared Ownership) Flats – 90%

Property Maximum LTV
New Build Houses 95%
New Build Flats (Shared Ownership & First Home England) 95%
New Build Flats (Not Shared Ownership or First Home England) 90%
Non-New Build Flats (Shared Ownership) 95%
Non-New Build Flats (Not Shared Ownership) 90%
2nd Homes for Personal Use or dependant relative 75%
Minimum Submission Criteria

Cases that arrive fully packaged at first underwrite

These cases will be fully underwritten within our service levels resulting in a quicker offer AND will secure the chosen mortgage product.

Cases with some supporting documentation at first underwrite

Any application that is submitted with some supporting documentation will be underwritten as normal and the intermediary/branch will have 15 days to submit the remaining documents.

If all documentation is not received within 15 days, the case will be cancelled. When documentation is ready to be submitted, contact the MSC on 0345 601 6683 for the case to be reinstated. Documents can then be up-loaded or faxed.

Should the product be withdrawn during this 15 day period, then the case will only be accepted on that product if full submission is received by the required deadline which will be notified to you by e-newsletter.

Cases received with no supporting documentation at first underwrite

Any application that is submitted WITHOUT supporting documentation at the first underwrite will be cancelled and the intermediary / branch will be notified. The case must be re-keyed once all supporting documentation is ready to be submitted and will be subject to existing products and policies that apply at the time.

Please note that the underwriting and Business Development Team have been advised that any cases received WITHOUT supporting documentation then subsequently resubmitted by an intermediary / branch, cannot take priority and will be underwritten in date order.

Where applications are received in the name of the broker themselves, these can be accepted provided that full advice is obtained (i.e from a fellow mortgage professional as ‘execution only’ is no longer an option). Alternatively brokers may apply through Skipton Direct.

The list below details the minimum submission requirements. The underwriters will use the documents provided with the application however, after assessing income and affordability if felt appropriate additional payslips, bank statements and or a P60 may be requested.

For more information on our submission criteria, please visit our Submitting Cases page.

Mortgage Offer Expiry Dates

Mortgage offers are valid for 6 months from the date of the first mortgage offer. After 6 months the Society may consider extending the offer but this will be subject to an up to date credit search and up to date income and affordability checks. A new application will be required if it is 12 months from the original offer date.

For new build properties the offer validity period is 9 months with the option to extend for a further 3 months subject to an up to date credit search and affordability assessment being carried out.

Non Occupying Borrowers

Permitted for residential lending only. Applications are not permitted on Buy To Let, Discounted or Family Purchase, or in conjunction with any other type of specialist lending, (e.g. Shared Ownership, Right To Buy, Help To Buy)

Normal LTV limits apply.

Maximum four applicants.

Independent Legal Advice is required for all non-occupying borrowers.

For applications where the term takes any applicant into retirement - standard lending into retirement (LIR) policy applies.

Applications would generally be expected on a capital repayment basis. However, where the requested repayment method is interest only the non-occupying borrower's residence will not be accepted as a repayment vehicle.

Non-Borrowing Occupier

Forms of Consent are required in all cases where the loan is in a sole name & there is a non borrowing occupier (NBO). Except where the occupier is:

  • Under the age of 17.
  • The child / stepchild of the borrower & aged 17 - 25 & in full time education at the time of application.

Independent legal advise is strongly recommended where there is an NBO residing in the property. Where independent legal advice is recommended and subsequently taken then that condition must be adhered to in all cases with a solicitor/conveyancer acting as a solicitor. This may incur a fee which is payable by the applicant.

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Payment Holidays and Overpayments

Payment Holidays

If the customers has made overpayments, we offer the option of payment holidays, giving them a break from mortgage payments for up to three consecutive months.

Customers can take payment holidays once they have had their mortgage with Skipton for six months, but they will need to give the Society at least 14 days prior written notice. As long as the customer has had no arrears the holiday proposed would not take the LTV of their mortgage above 95%, and there are sufficient surplus payments to cover the holiday, the customer may take up to three consecutive months' holiday.

Customers cannot take more than a total of six months in any 12 month period. Whilst payments will not be made during the holiday, interest will continue to be added to the account causing the balance to increase.

Overpayments

By making overpayments the customer could be able to pay off their mortgage earlier than originally planned saving in interest. All of our mortgage deals allow customers to repay a fixed percentage of their original mortgage balance per year without charge.

Most of our mortgage deals include Early Repayment Charges (ERCs) if overpayments are made that are more than the set overpayment allowance on the product. Full details of this showing in the Mortgage Illustration and Mortgage Offer.

Porting

Existing customers who wish to port their current mortgage product can do so if the product is portable. They can “top up” with any product from the current product range, subject to meeting the product maximum LTV and other associated criteria and any fees will be payable i.e. £995 / £695. Or the porting / top up product can be used, subject to meeting the product maximum LTV and applicable completion fees will be payable.

Purpose of Loan
Acceptable Not Acceptable
Home Purchase Golden Hands
Family Discount Purchase Holiday Homes
Shared Equity (Lift Scheme) Self-Build / BuildStore (inc. A / Bs)
Right To Buy Short-term lending
Tenant Purchase Captial raising for business purposes and debt consolidation
Shared Ownership
Purchase and Remortgage - owner/registered proprietor must have owned the property for a minimum 6 months ownership Builder's incentives where there is a part exchange property and the builder is paying above market value.
Buy To Let (BTL) Bridging finance
Transfer of Equity Help To Buy (Mortgage Guarantee - Scheme 2)
Second homes for personal or main residential use for dependant relative (maximum 75% LTV & income has to cover total debt i.e. existing & proposed mortgage debt.). Guarantors
Help To Buy (Shared Equity Loan - Scheme 1)
Repayment Methods
  • Capital and interest
  • Endowment - policies are not deposited or assigned
  • Part and Part, restricted to 80% LTV and below, maximum term 25 years
  • Interest Only is acceptable for mortgages and remortgages (except first time buyers) - refer to the Interest Only section.
Right to Buy
  • The Society will lend up to 100% of the discounted purchase price. LTV is restricted to product max and is calculated on open market value
  • Right to Buy notice must be obtained reflecting name(s) on mortgage application exactly
  • Additional funds can be raised for home improvements to 75% of the open market
  • Value (as confirmed by the Society’s valuer)
  • No capital raising for any other purpose is acceptable.
  • Right to Acquire

    Where applicants have the right to acquire a property, applications will be considered and the above Right to Buy policy will apply.  Where sufficient evidence / documentation does not exist, applications will be declined.

Scottish Applications

Scottish cases should proceed on the same basis as normal considering the following:

Purchase Applications

A valuation will already have been completed.

New Build

Where are property is a new build, a transcript report is not acceptable. The Society will instruct a full standard report for which a fee may be payable to the Society by the applicants, this is dependant on the product selected. (Please refer to the new build section for the Societies definition of a New Build)

Remortgage and TSM Applications

Normal Valuation Rules apply.

Retentions

Where a retention has been help and the Society has a transcript valuation on file, in order to consider releasing the retention, the application may pay for a standard valuation.

Funds will then be release subject to lending criteria being met and satisfactory valuation being received.

LIFT scheme

The Shared Equity Loan Lift scheme is acceptable on houses only and the LIFT scheme acceptance letter is required.

LIFT scheme is not acceptable on new build properties, flats/maisonettes of any description and 1 bedroom properties or when the scheme is subject to Golden Share.

Shared Ownership

Acceptable

Shared ownership applications are acceptable for residential lending in England with the borrower share of the property acceptable between a minimum of 25% and a maximum of 75% based on the initial purchase price.

The Society will lend up to 95% LTV of the borrower's share of the property. Product restrictions apply.

Where financial incentives are provided, the incentive cannot exceed 5%.

Where financial incentives are provided - the LTV will be capped at 90%.

Minimum loan £25,000. Maximum loan subject to usual loan and LTV maximum restrictions.

Maximum term 40 years. Age at end of the term must not exceed 75 years.

Maximum loan to income (LTI) - 4.5.

Shared Ownership applications are only permitted on a capital and interest repayment basis only.

Maximum storey height/number of units in a development:

  • For properties built before 2008, 5 storeys/48 units
  • For properties built in 2008 or after, over 5 storeys/48 units is acceptable (subject to lift access and valuers comments).

Title restrictions on disposal (i.e. restrictive covenants/Section 106 agreements).

These are restrictions within the title to the property and must not be confused with standard restrictions within the acceptable shared ownership model lease.

For title restrictions, the Society will typically accept the following types:

  • salary/occupational restrictions
  • locality restrictions
  • a combination of the above

However, acceptance by the Society is subject to one (or more) of the following:

  • any restriction must only apply to the first transaction (i.e. the initial purchase transaction) and the restriction must not apply to any subsequent future transaction(s)
  • there must be a cascade mechanism in place that commences after a maximum of 3 months from the date of possession, with no restriction of any kind after 6 months from the date of possession
  • there must be a Mortgage Exclusion Clause in place in which applies immediately upon possession and will continue to be in force for successors in title to the mortgagee ensuring that all successors also take free from the relevant restrictions.

Any restrictions should be disclosed within the application to ensure the Society's valuer is fully informed in their assessment of the property.

Any clauses/restrictions other than those listed above will result in the application being declined.

We will not allow cases where the pre-emption rights survive 100% staircasing. This will be included within our instructions to conveyancers but not within our mortgage offer.

Landlord restrictions

The leaseholder must be regulated by the HCA and be either registered Housing Association or a registered provider appearing on the HCA register.

Please check the list of registered providers by visiting www.gov.uk/government/publications/current-registered-providers-of-social-housing.

In all instances the lease must adhere to the model produced by the HCA and incorporate a Mortgage Protection Clause.

Rent and service charge

Amount due must be declared on application and used in affordability assessment.

Lease

All Shared Ownership properties must be leasehold with a minimum unexpired term in line with existing SBS policy on leasehold property.

Staircasing

Borrowers must be permitted to staircase to 100% ownership under the terms of the lease. Staircasing must be conducted in minimum shares of 5% with prior approval from the scheme provider. Where 100% staircasing has taken place, standard remortgage products are used.

Additional Borrowing

Is only permissible for the purposes of staircasing where permission has been granted by the scheme provider. In all cases borrowers are required to maintain at least a 10% deposit against the market value of the property.

We may also consider additional borrowing for essential repairs to the property and where the lease term is being extended subject to permission being granted by the registered provider and confirmed in writing.

Staircasing involves the legal transfer of equitable title from the Shared Ownership Provider to the customer which has legal formalities in order to be valid. Where additional borrowing monies are required on shared ownership for staircasing, a conveyancer (on Skipton's panel) will be required to ensure the purchase of the additional equitable title is legally sound. Any costs incurred are payable by the customer. Additional Borrowing Shared Ownership offers will be valid for 6 months.

A minimum Additional Borrowing loan of £5,000 is permitted for Shared Ownership mortgages where the loan is to be used for staircasing.

Remortgages

Acceptable for any shared ownership property which meets our existing criteria. Remortgages must be on a like for like basis unless additional borrowing is sought for staircasing.

For TSM we may allow capital raising to buy out the interest of another party subject to approval from the registered provider in writing.

Skipton Home Conveyancing Service can be used for Shared Ownership. There may be a charge in relation to a Deed of Variation (if applicable).

Conveyancing

It is the duty of the conveyancer to ensure the lease meets the minimum requirements as set out in our Instruction to Conveyancers [pdf]. In all instances the lease must adhere to the minimum standards of the model lease produced by the HCA and incorporate a Mortgagee Protection Clause.

Valuations

AVM's are not acceptable.

Gifted deposit

Acceptable subject to prior consent from the Shared Ownership provider. Skipton will not accept a second charge registered against the property.

Contract variations

Rate switches are acceptable on specific shared ownership retention products. Any other contract variations will follow the standard process, as long as prior approval has been obtained from the provider (if required).

Maximum exposure per development

In line with standard lending policy, maximum exposure in any development is 20%.

Offer validity

9+3 months for new build properties, otherwise 6 months

Registered provider exposure

Maximum exposure with any registered provider is 20%.

Letting

Not acceptable for Buy to Let. However, serving members of the British Armed Forces serving overseas or at a base further than 50 miles or 90 minutes travelling time automatically have the right to sub-let their shared ownership properties. We will require evidence of SO providers awareness/consent before we can process the Armed Forces Consent to Let.

Minimum submission requirements

Standard minimum submission documentation applies (see section A.0) with the addition that for purchase SO cases, a Memorandum of Sale is required.

Skipton Home Conveyancing Service

Remortgage Conveyancing Service

If you're moving your mortgage to Skipton but not moving home, then you won't usually have to pay anything for the legal costs involved if you elect to use our Remortgage Conveyancing Service, depending on your chosen product. In other words, it's free to you, as we pay the standard legal costs within the service.

As well as this, we pride ourselves on having a well-established relationship with our recommended conveyancers who provide the legal work for our Conveyancing Service and this helps to make the process as hassle free as possible for you.

The remortgage work is undertaken by the conveyancers on a ‘reduced title check' basis which Skipton considers is sufficient to assess its security. If for any reason you wish the conveyancers to carry out a full title check on your behalf they can do so but any additional costs involved are payable by you.

For your peace of mind, experienced and well respected firms are currently used in the Skipton Remortgage Conveyancing Service. They are regulated by the Council for Licensed Conveyancers.

Fees

Please be aware that some legal work relating to matters not usually involved in a standard remortgage are not included in this offer e.g. transfers of equity or deeds of postponement. The solicitors will offer fixed prices for certain "elevated services". Please see our Elevated Service fees leaflets for further information.

In addition to this, if the loan is above £1,000,000 additional costs may be payable. Some payments to third parties may also still have to be paid and occasionally we may offer certain products with other benefits where we do not pay the legal costs.

If you're unsure as to whether additional costs may be involved in your mortgage, please speak to your mortgage adviser in the first instance.

If at any time your remortgage falls through, then you won't have to pay any standard legal fees, but fees which relate to matters not usually involved in a remortgage may still have to be paid.

Max Term

Normally up to 25 years, but up to 40 years can be considered on a repayment (capital & interest) basis only.

Trust Arrangements

The Society does not accept Trust arrangements in favour of any person or body who is not a party to the mortgage.

TSM (Transfer Subject to Mortgage) Table

TSM policy relates to existing SBS borrowers only, where a request is made to either change the names on the existing mortgage (i.e. remove & / or add a name) and in some cases where also additional funds are requested to buy out a partner etc.

Acceptable Valuation Types:

  • LTV up to & including 60%: The Society will assess the case against the original file valuation (index linked).
  • LTV 61%-75%: An AVM is acceptable subject to standard AVM acceptable criteria
  • LTV over 75%: Up To Date report required. Where only an AVM is on file or if the valuation report on file is over 5 years old then a full standard report will be required.

Free Valuation/Free Legal Type Rules

A TSM application may not qualify for free valuation or free legal fees. The application will be processed as a remortgage purely as a result of internal system restrictions. Additional funds can be raised to pay ex-partner and this can be raised on the same product or any product from the current range. Normal lending criteria applies; cases outside of policy should be referred to the MSC for consideration by a Lending Manager. Justification and evidence of affordability must be obtained prior to referral.

If the application does not qualify for free legal fees the customer can choose to use Skipton Home Conveyancing Scheme (SHCS) and pay the fees. We will debit the fees for the standard legal work to the mortgage account on completion and the elevated service part will be invoiced by CDPL to the customer directly. The advantage to the customer is that the fee for the standard legal work is very competitive, although it is important to note that the fees may differ dependent on area, i.e. England, Scotland etc

Property

Acceptable Property Types

Acceptable

  • New build houses for residential (off plan is acceptable providing build is completed within 12 months of the 1st mortgage offer)
  • New build remortgage (if proof from Land Registry is obtained confirming property already owned by applicant(s) for 6 months)
  • New build flat/flat conversions for residential
  • Flats that have a minimum floor space of 35 square metres. There is no restriction on floors in block or number of units in block, but if the number of floors exceeds 5, then lift access is required
  • Leasehold properties with a minimum 85 years unexpired term on completion of the mortgage
  • Non-standard flats (e.g. with commercial (including retail) outlets in the development/block, Ex Local Authority Flat, Deck Access, Mezzanine Floor (galleried) and Studio Flats) minimum property value £150,000 / £300,000 Greater London)
  • Grade II listed buildings (C in Scotland)
  • Properties with Japanese Knotweed (subject to valuer’s comments)
  • Repossessions

Not Acceptable

  • Grade I/ Grade II* Listed properties (Grade A & B in Scotland)
  • Any Security affected by any invasive plant species
  • Flats if number of floors exceeds 5 and no lift access
  • Any flat with a floor space less than 35 square metres
  • Leasehold properties with less than 85 years unexpired term on completion of the mortgage
  • Commonhold properties

The property must be;

  • Of a traditional construction, as defined by the Society’s panel valuer for the property type
  • In a satisfactory condition
  • Of a suitable type
  • Be recommended as suitable security by a valuer on the Society's valuer panel
  • Split titles are not acceptable
  • Within overall exposure limit in any development (will typically be limited to 20%)

For Residential applications £50,000 is the minimum accepted purchase price/property valuation (whichever is lower)

Flats - Residential

Flats are acceptable for residential purposes as per our policy outlined below:

Please note: Our policy on flats does not restrict based on storey height or number of units in a block, but where storey height exceeds 5 floors access to a lift is required.

  • New build flats/flat conversions are limited to a maximum 90% LTV (except for Shared Ownership and First Homes England Schemes which have a maximum LTV of 95%). Non new build flats are limited to 90% LTV (except for Shared Ownership which have a maximum LTV of 95%)
  • Minimum property value for standard flats is £50,000
  • Non-Standard flats (above commercial, deck access, mezzanine flats, studio, ex-local authority) are acceptable for Residential purposes, the minimum value is £150,000/£300,000 in Greater London
  • Overall exposure in any development typically limited to 20%
  • Re-enforced in situ concrete with brick render is considered a standard construction for flats and is acceptable to the Society
  • Minimum floor space of 35 square metres for all flats is required.

Flats within commercial/retail outlets

A standard valuation will be carried out and the decision to lend will be made on whether the valuer recommends we proceed. The recommendation will be subject to the valuer believing the property is suitable security for a mortgage and will be easily re-saleable. The valuer's decision is final: no challenges will be accepted, and no refunds of valuations fees will be issued if the decision is a decline.

Freehold flats

Freehold flats are not acceptable. The only exception to this is the purchase of freehold flats in Scarborough. Tyneside flats where there are reciprocating lease / freehold arrangements are also acceptable.

Maximum Acreage

The maximum acceptable acreage is 3 acres. Consideration of up to 10 acres may be made by exception, subject to surveyors’ inspection and recommendation based on residential use only and ‘modest’ outbuildings (e.g. some stables/loose boxes/tack room/feed store/small hay store/small workshop/normal garaging). Any property with large commercial style agricultural buildings and/or acreage over 10 acres will not be accepted.

New Build

Please see New Build policy category for specific policy requirements.

Property Types

Precast reinforced concrete (PRC) DWELLINGS (Houses only)

PRC properties that have been repaired under a PRC Homes Ltd. licensed repair scheme are acceptable provided the valuer confirms that the property is suitable for mortgage purposes. The valuer should identify the property type and the conveyancer should obtain confirmation that the property has been repaired using a PRC Homes Ltd licensed repair scheme.

PRC properties that have been repaired by a local authority but not under an official PRC Homes Ltd licensed repair scheme are acceptable provided that the repair is in accordance with such a scheme and the valuer has confirmed that the property is suitable for mortgage purposes. The valuer should identify the property type, and suitable documentation must be obtained by the conveyancer confirming that the property has been repaired to the standard of a PRC Homes Ltd scheme. This documentation is essential as it is impossible for the valuer to know merely from an inspection exactly what repair work has been undertaken to the structure. If no documentation is available, the case is not acceptable unless the property is inspected by a structural engineer who confirms that the repair that has been undertaken is equivalent to PRC licensed standards. (A 10 year warranty without proof of the type of repair work undertaken is insufficient).

PRC properties repaired under NTHAS (non traditional homes appraisal scheme) (Non Traditional Homes Appraisal Scheme) are acceptable if they have been repaired to a minimum grade 5 standard and provided the adjoining semi detached house (or all the properties in a terrace which contain the subject property) have been repaired and the valuer has confirmed that the property is suitable for mortgage purposes. The standard of repair must be confirmed by documentation provided to the conveyancer as it is impossible for the valuer to know merely from an inspection exactly what structural repair work has been undertaken.

The above criteria does not apply to newly built blocks of flats.

A number of different companies developed schemes for specific PRC types that were approved by PRC Homes Ltd. Below is a list of designated defective PRC construction types (from the Building Research Establishment (BRE) Guide to Non-Traditional Construction).

In order for these types to be acceptable the property needs to have been repaired in accordance with a scheme licensed by PRC Homes Ltd. Also all other dwellings in the same block (other semi or rest of terrace) must be repaired to the same standard and that all paperwork must be contemporaneous to the original works. A standard mortgage valuation must be instructed on these construction types and is subject to surveyor comments and recommendations.

  • Airey
  • Ayrshire County Council
  • Blackburn Orlit
  • Boot Beaucrete
  • Boot Pier and Panel
  • Boswell
  • Cornish Unit Type I
  • Cornish Unit Type II
  • Dorran
  • Dyke
  • Gregory
  • Mac-Girling
  • Myton
  • Newland
  • Orlit
  • Parkinson
  • Reema Hollow Panel
  • Schindler
  • Smith
  • Stent
  • Stonecrete
  • Tarran Temporary Bungalow
  • Tee Beam
  • Ulster Cottage
  • Underdown
  • Unitroy
  • Unity Type I
  • Unity Type II
  • Waller
  • Wates
  • Wessex
  • Whitson-Fairhurst
  • Winget
  • WooIaway

No-fines Construction

Wimpey no-fines construction and Laing Easiform construction (built post 1945) are generally acceptable and in each case suitability for lending purposes will be dependent on the valuer’s comments.

Steel Frame Construction

Skipton does not generally accept steel frame dwellings unless a structural engineer's report (of the steel frame) is obtained and all recommended work within that report is carried out and the mortgage valuer confirms that the property is suitable for mortgage purposes. (A structural engineer's report is essential as a valuer is not able to ascertain the condition of the steel framework merely by carrying out a mortgage valuation)

The above criteria does not apply to newly built blocks of flats. Please refer to the full Residential Criteria for more information.

Timber Frame dwellings

Timber frame dwellings built prior to 1965 are unacceptable with the exception of listed period buildings.

Large Panel Systems (LPS)

Skipton does not lend on properties of this type of construction.

Space4 System

Space4 is a designated Modern Method of Construction (MMC).  The system is effectively a development of modern timber frame. The structural timber frame is bonded to a cementitious particle board (instead of a wooden board in timber frame) and phenolic insulation is inserted between the timber studs to provide the necessary thermal insulation to the wall element. Suitable breather barriers are also used to control the passage of moisture through the wall element. This structural element is separated from the outer face of the wall (non-load bearing, purely cosmetic and usually either brick or rendered block) by a cavity.

Space 4 is generally acceptable and in each case suitability for lending purposes dependent on valuers comments.

Single Skin Construction

The Society will only allow a small portion of the property to be constructed of single skin which must only be one storey in height and subject to satisfactory comments from the valuer.

Modern Moduler Steel Frame with Brick Extension

The Society may be willing to lend subject to valuer's comments.

Mundic Block

Properties in areas where "mundic" is a known problem (properties build from concrete blocks laid onto mass concrete foundations) must be subject to a screening test in line with RICS guidance. A result of Class A1, A2 or A3 is required for a property to be considered acceptable.

Rent A Room Scheme / Air BnB

This is acceptable, providing there is no formal tenancy agreement in place. We cannot use the income received from this. We have to be sure that the applicant is living in the property and that no more than one room in the house is rented out on this basis.

The Society will not consider any applications where any element of our security address is let out via Air BnB and/or similar schemes.

Solar Panels/Wind Turbines/Biomass Boilers

The Society does not apply any restrictions in relation to any of the above.

Tenure

All flats and maisonettes must be leasehold (feuhold in Scotland) with a minimum unexpired term of 85 on completion of the mortgage.

Leasehold flats where the borrower will also own a share in a management company that owns the freehold are acceptable.

Freehold flats are not acceptable. The only exception to this is the purchase of freehold flats in Scarborough. Tyneside flats where there are reciprocating lease / freehold arrangements are also acceptable.

Commonhold properties are not acceptable to lend on, by the Society.

Valuation Fee Scale

View our current Valuation Fee Scale for full details.

Valuation Information
  • We aim to instruct a valuation within 24 hours of the application being submitted. The type of valuation instructed will be the most suitable for the application, taking into consideration property type, LTV, etc.
  • Connells act as the Society’s panel managers and deal with maintenance of the panel together with the allocation of all instructions. A Panel Valuer that covers the security postcode area is always used
  • Some products may qualify for a free valuation. This is up to a maximum purchase price/estimated valuation of £1,500,000. Please refer to the specific product details for further information
  • A valuation instructed for Additional Borrowing purposes is free to the Customer, irrespective of the type of report obtained by the Society
  • The minimum acceptable property value is £50,000
  • Valuations are valid for 12 months from the date appearing on the valuation report or transcript report
  • The Society does not accept re-type valuations except on Scottish cases, where a transcript is requested. If more than 3 months old, we will require a refresh before the transcript will be requested
  • The Society will instruct a valuation for mortgage purposes only
  • The Customer can request a RICS Home Survey Level 2 or a RICS Home Survey Level 3 but they would need to arrange this directly with Connells. Connells will provide a discount for cases proceeding with the Society, the customer should contact Connells direct on telephone number 01525 218655 to benefit from this service. Requesting a RICS home survey Level 2 or Level 3 will not delay the mortgage offer.
Title Restrictions

Restrictive Covenants - Section 106 Agreements

For title restrictions, the Society will typically accept the following types:

  • salary/occupational restrictions
  • locality restrictions
  • a combination of the above.

However, acceptance by the Society is subject to one (or more) of the following:

  • any restriction must only apply to the first transaction (i.e. the initial purchase transaction)
  • there must be a cascade mechanism is in place that commences after a maximum of 3 months from the date of possession, with no restriction of any kind after 6 months from the date of possession
  • there must be a Mortgage Exclusion Cause in place which applies immediately upon possession and will continue to be in force for successors in title to the mortgage ensuring that al successors also take free from the relevant restrictions.

Any restrictions should be disclosed within the application to ensure the Society's valuer is fully informed in their assessment of the property.

Any clauses/restrictions other than those listed above will result in the application being declined.

Overage Clause

An overage agreement is where the vendor has registered a clause against the title of the property that stipulates, they will receive a % of any increase in value once it has been sold on. This is usually triggered if planning permission is granted on the property, but the terms will be specific for each case.

The Society does not lend on any properties where there is an overage clause attached to the title and such applications will be declined.