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Mortgage Lending criteria

Mortgage Lending Criteria - Halifax

Halifax


Notes: The following information is general and may not apply to your mortgage. We have not verified this information with the lender.

Ask your broker to confirm any aspects that are important to you. The main features of this mortgage will be confirmed in the Key facts Illustration. Please ask your broker for a Key facts Illustration

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Mortgages

Advances
Upto 1,000,000

Notes
Mortgage is Portable, Mortgage is Flexible, Under payments allowed., 10% Overpayments allowed per year.
You can take the following product with you to new mortgage on another property during the product rate period.
When the product rate period has ended any lender variable rate that then applies to that part of the mortgage is not portable.

If you need to repay your mortgage to move home during the product rate period, provided you do not change lender (and, where the lender provides mortgages under more than one brand, you do not change brands), you will usually be able to take the terms of the product with you and they will continue for the remainder of the product rate period.

In addition, if this is during an early repayment charge period; provided you borrow the same or a greater amount, you won’t normally have to pay the charge. If the loan is for a smaller amount, you may have to pay part of the charge.

Further information regarding portability can be found in the section headed 'Early Repayment Charges' in the booklet 'Information about your mortgage' which the lender issues with mortgage offers.

Free Legal
With our remortgage service we will pay our legal fees or your customer can arrange their own conveyancer and pay their own costs.
There is no charge for a property assessment.
REMORTGAGE PRODUCTS ARE NOT AVAILABLE TO UNENCUMBERED PROPERTIES. MORTGAGE FREE PROPERTIES MUST CHOOSE HOMEMOVER PRODUCTS.

REMORTGAGE SOURCING - PLEASE ENTER AN EXISTING LOAN AMOUNT.

MAXIMUM LTV ON INTEREST ONLY AND PART & PART IS 75% LTV.

This product is not available to Consent to Lease.
This product is not available to Shared Equity/Ownership customers, please see Affordable Housing range.

For loans above 1million on the Standard range of products please contact the Premier Unit on 020 7012 8560.

The Remortgage Service is not available to existing customers.

The maximum LTV for Second Home Loans is 75%.

Payment Holidays Allowed. You may make a request to suspend payment of all or part of your monthly payment for one or more months (take a payment holiday), provided that you meet the policy criteria in force at the time of your request. Details of the current policy criteria can be found in the booklet ‘Information about your mortgage’ which is issued with the mortgage offers but you should ask for details of the latest criteria when you make your request.

The Halifax will not charge you for a valuation of the property, but will arrange for a valuer to make an assessment for the Halifax.
If you use the Remortgage Service, the Halifax will arrange for any legal work required by them in connection with the remortgage to be carried out. However, this will not cover any legal advice you require nor will it cover any costs incurred for any additional legal work carried out on your behalf.

You are able to make lump sum or regular overpayments to this mortgage at any time.

Currently, as a concession, during the period when an early repayment charge applies, you can make overpayment up to 10% of the outstanding balance each calendar year (as at 1 January of the year in question or, in the year in which you take out your mortgage, the original balance) and the charge will be waived. The lender reserves the right to change or withdraw this concession.

For more detail on how this concession will be applied if your mortgage is divided into separate sub-accounts, please see the booklet ‘Information about your mortgage’ which is issued with mortgage offers.

The lender’s daily interest method will apply and the interest charged takes account of any changes in the mortgage balance from day to day. Any payment you make will reduce the balance and therefore the amount of interest you are charged, from the day after we receive it.

You pay less than the normal monthly payment for one or more months or miss one or more monthly payments (make underpayments), provided you have previously made overpayments and the amount of the underpayments does not exceed the amount of your previous overpayments less any amount you have previously underpaid. You must give notice of the months in which you wish to underpay.

Where your monthly payment and/or your mortgage term are changed (for example, following an interest rate change) and the change takes any previous overpayments into account, then those overpayments will no longer be available for the purpose of making underpayments.

The availability of the mortgage product chosen is based on the amount of loan as a percentage of the value of the property. Changes to the loan amount or the property value could alter the availability of this product. If this is the case, please ask for a revised illustration.

If the amount you owe under your mortgage comes to exceed the original loan, the lender may charge interest on the excess at Halifax standard variable rate, currently 3.99%.

Capital Rest Period : Daily

Repayment Types
Repayment Yes
Endowment 75% LTV
PEP 75% LTV
Pension 75% LTV
Interest only (no RV) No
With Profits 75% LTV
Unit Linked 75% LTV
ISA 75% LTV
Split Repayment 75% LTV



Fees


Arrangement : varies
Booking : varies

Early Repayment Charges: varies
10% capital repayments allowed per year without penalty

Higher Lending
None

Valuation
Basic:

upto 50,000 - 240
upto 100,000 - 280
upto 150,000 - 315
upto 200,000 - 355
upto 300,000 - 430
upto 400,000 - 500
upto 500,000 - 565
upto 600,000 - 620
upto 700,000 - 680
upto 800,000 - 735
upto 900,000 - 790
upto 1,000,000 - 845


Homebuyers:
upto 100,000 - 465
upto 150,000 - 495
upto 200,000 - 545
upto 300,000 - 665
upto 400,000 - 795
upto 500,000 - 940
upto 600,000 - 1080
upto 700,000 - 1225
upto 800,000 - 1365
upto 900,000 - 1510
upto 1,000,000 - 1650


Min Valuation 40000
For products that allow fees to be added to the loan, interest is calculated at SVR, not product rate. This will not be reflected in the illustration.

For properties valued over 10m, please refer to Halifax for fee.



Mortgage Account Fee - 265.00 Payable on completion. A Mortgage Account Fee is payable on completion. The fee will be added to the loan. The fee is to cover the setting up, routine maintenance, and closing down of the mortgage account. The fee is non refundable.

Acceptable Property Types


Freehold Flat No
Purpose Built Flat Yes
Converted Flat Yes
Flat Over Shop Refer
Maisonette Yes
Studio Flat Yes
Flying Freehold Yes
Thatched Refer
Timber Framed Yes
Concrete Refer
Agricultural Tie Refer
Flat Over 4 Storeys Yes
Listed Building Yes

Max Discount% 100
Max Market Value% 95
New Build acceptable.

New build mainstream lending (houses and flats) is acceptable up to a maximum of 80% LTV.

Builder/Vendor deposit max acceptable 5% of lower purchase price or property value.

Builder Cash Incentives in excess of this figure may result in a reduction in the maximum loan available.

Where existing property is to be rented out- the existing mortgage debt may be disregarded providing the rental income covers at least 125% of the annual interest charged on the existing mortgage debt at the Halifax Standard Variable Rate. The property letting should be managed by an ARLA agent or HEAL who must confirm there is sustainable rental market for this type of property. If the letting is not being done through ARLA/HEAL the case must be referred to Halifax for a decision whether to proceed. Please refer to lender for further details.

Timber framed properties are acceptable at the discretion of the valuer and based on their individual merits.

Accepted Locations : England, Scotland, Wales, N Ireland

Requirements


Bank Statements 2 months
At Least 3 Months Pay Slips Yes
P60 Yes
Proof Of Residency Yes
Life Policy To Be Assigned No
Previous Lender References No

Insurance
Buildings Conditional

Conditions On Loan
Min Loan
Max Loan /Rmg 1,000,000
Max Portfolio of BTL Loans none
Min Age 18 years
Max Age 75 years
Min Term 1 years
Max Term 40 years

The policy relating to the Mortgage Products of existing borrowers moving home has been changed. Customers on annual interest rate products with early repayment charges will now have several options on their existing products: 1) Port the product on an annual interest basis and top up with one of the annual interest products from the current range; or 2) Change the interest calculation method to daily interest and top up with one of the daily interest products from the current range; or 3) If their product has finished, but they are still within a tie in period, they can choose entirely from the new product range and the early repayment charges will be waived; or 4) Pay the early repayment charges and choose entirely from the new product range.

Customers on a daily interest product can port that product over, and top up with a daily interest product from the current range. This is not an exhaustive list of scenarios. Speak to your Intermediary Sales Manager with any queries.

Halifax does not lend in Jersey.

No maximum age - An assessment/evidence of stated retirement income may be required where the term exceeds the applicant(s) 65th birthday.

Minimum trading period for self employed is 1 year and a projection.

Remortgage applications not accepted where the customer has owned the property for less than 6 months.

Interest Only - All loans arranged where the capital element is not included in the monthly payment must have a plan in place to repay the capital by the end of the term. This must be reasonable for the customers' circumstances. You must tell Halifax what the customers' intentions are.

INTEREST ONLY - Maximum LTV on interest only loans is 75%.
A mix of interest only and repayment is allowed but the total borrowing must be less than 75% LTV.
For house purchase and remortgage where the total LTV is over 75% all borrowing must be on a repayment basis.
Customers taking out a loan above 75% at application stage cannot transfer from repayment to interest only, within the first 12 months of completion of the mortgage.


Foreign Citizens Refer
Ex-Patriates Not Accepted

Income Multipliers


Based on Income > 0
5 + 0 or 4.5 joint

Min months in current position none
Min months in continuous service none
Min no. of years accounts 3
Average years taken to calculate income 2
Will consider declining profit Refer

Outgoings
Employed:
An employer reference must only be used where the customer cannot provide bank statements or payslips or where there are discrepancies that need to be confirmed.

Latest payslip or latest 2 weekly pay slips or if overtime, bonus or commission is being used, latest 3 monthly payslips or latest six weekly payslips

PASS A UP TO 85% LTV - Income confirmation is not usually required.
PASS A MORE THAN 85% LTV AND ALL PASS B - Either, latest monthly payslip or latest 2 weekly payslips or if bonus/overtime/commission is being used, latest payslip plus P60.
ALL PASS C - 3 In all instances the following are required:
3 months personal bank statements plus either, latest monthly payslip or latest 2 weekly pay slips or if bonus/overtime/commission is being used, latest payslip plus P60.

ALL CASES (PASS A, B & C) ABOVE 500k - Referred for underwriting and income confirmation will be determined and requested as required.

Self Employed


An accountants reference must only be used where the customer cannot provide SA302's or Accounts or where there are discrepancies that need to be confirmed.

PASS A UP TO 65% LTV - Income confirmation is not usually required.
PASS A MORE THAN 65% LTV AND ALL PASS B - Last 3 years tax assessments or letter from accountant confirming income.
ALL PASS C - 3 months personal bank statements and 3 months business bank statements plus last 3 years tax assessments or letter from accountant confirming income or Accounts.
ALL CASES (PASS A, B & C) ABOVE 500k - Referred for underwriting and income confirmation will be determined and requested as required.

Lending based on affordability - please see www.halifax-intermediaries.co.uk for affordability calculator.

Contract Workers:
Yes to Fixed / Short / Agency / Probationary Contracts.
12 months or more continuous employment with their current employer, with 6 months of the contract remaining or
2 years continuous service in the same type of employment

IT contractors and other contractors whose income is more than 500 per day or 75,000 per annum:
Whether employed or self-employed, we accept the gross value of the contract as evidence of income. All applicants must have been contracting for a minimum of one year or employed in a similar business.

Hire Purchase Taken into account
Personal Loans Taken into account
Overdraft Refer to lender
Credit/Store Cards Taken into account
Child Maintenance Taken into account
Child Education NOT Taken into account
Extra Income:-
Other Income - Guaranteed Add 60% to income before multiply
Other Income - Regular Add 60% to income before multiply
Other Income - Irregular Add 60% to income before multiply
Investment Income No
Mortgage Subsidy Add 60% to income before multiply
Large Town Allowance Add 60% to income before multiply
Maintenance Payments Add 60% to income before multiply
Non Contributory Pension Add 60% to income before multiply
Car Allowance Add 100% to income before multiply
 

Remortgage


Capital Raising 75%
Home Improvements 75%
Debt Consolidation 75%
School Fees 75%
Holidays/Cars 75%
Buy Other Property 75%
Business Purposes Not accepted
Divorce Settlement 75%
Unencumbered Acceptable


If a customer with shared ownership is remortgaging and buying an additional/final tranche Halifax will charge an additional fee for conveyancing and disbursements, please refer to Halifax for full details.

Remortgage products are not available to unencumbered properties. Mortgage free properties must choose Homemover products.

Adverse Credit


CCJs : Not Acceptable
Defaults : Not Acceptable
Arrears : Not Acceptable
Bankrupt : Not Acceptable
Current IVA : Not Acceptable
Repossession : Not Acceptable


- The Lender will judge customers with previous or existing adverse credit in a flexible manner and every case will be judged on its individual merits, along with the customer's ability to keep up repayments on the mortgage, taking into account his/her existing liabilities.

- The Lender will consider cases of financial difficulty and mortgage arrears sympathetically.

- The Lender follows the general principles of the Council of Mortgage Lenders' Statement of Practice on Handling Arrears and Possessions, including :

a) with your co-operation, developing a plan with you for dealing with your financial difficulties and clearing the arrears, consistent with both your interests and those of the Lender.

b) possession of your property will be sought only as a last resort when attempts to reach alternative arrangements with you have been unsuccessful.

November 2013