Coventry Mortgage Lending Criteria

We have not verified the information with the lender. You should not rely on this information. If you have an area of concern then please ask us.

Coventry Mortgage Lending Criteria

Mortgage Advances

Up to £1,250,000 75% LTV

Up to £2,000,000 65% LTV

Notes

Illustration Type = ESIS.

Mortgage is Portable, Mortgage is Flexible, Overpayments allowed.

The product(s) selected are fully portable. Please refer to our 'Moving your Mortgage to a New Property' brochure for

further information.

Coventry Building Society operates a restricted panel of intermediaries.

The Privilege Rate is available to those existing borrowers holding a residential mortgage that have remained on the

same Coventry scheme for 5 years or more please refer to Coventry Building Society.

A maximum term of 35 years is available for all other acceptable repayment methods.

Lender will consider advances subject to current lending policy

We no longer have a requirement for proof that payments have been resumed following a Covid-19 payment holiday

One mortgage valuation fee is waived up to a maximum amount of £670 if the Lender instructs the valuer. In some

instances different valuation assessments may be under taken. If applicable the actual fee you pay is shown in interest

rates and other costs.

For this mortgage, you will, during the period where early repayment charges apply, be allowed to overpay by up to 10%

of the mortgage balance outstanding, each calendar year without having to pay early repayment charges. The mortgage

balance outstanding is taken at the 1 January or at the start of your mortgage, whichever occurred last.

During the period where early repayment charges apply, any payments above the annual limit will be subject to an early

repayment charge on the basis shown in section 10 of this illustration. If you repay your mortgage off in full you will be

charged early repayment charges on the entire outstanding mortgage balance required to redeem your mortgage.

Following the period where early repayment charges apply, this mortgage allows you to make an unlimited amount of

overpayments without incurring any early repayment charges.

Any overpayment using the direct debit overpayment facility will be applied to the mortgage immediately and interest

recalculated. You will be advised of your revised repayment if applicable.

Capital Rest Period : Daily

Repayment Types

Repayment Yes

Endowment refer

PEP refer

Pension refer

Interest only (no RV) no

With Profits refer

Unit Linked refer

ISA refer

Split Repayment refer

Fees

Arrangement : £ varies Can be Added

Booking : None

Early Repayment Charges

varies

Higher Lending

None

Valuation

Basic:

Free

Product fee can be added to the loan.(Non-refundable)

One mortgage valuation up to the max £670, additional fees above this rate will be reduced. Only valuations conducted

by the Coventry Building Society’s panel of valuer's are acceptable. You may have one mortgage valuation (up to a

maximum of £670) which must be carried out by a valuer instructed by the lender. The valuation is for the Lender’s

benefit only and used to confirm whether they can lend on the property. It’s important to remember that the Lender

decides the type of valuation most appropriate to the application; therefore a physical inspection of the property may not

be required.

Funds Transfer Fee - £8.00 Added to loan.

Mortgage Exit Fee - £125.00 Payable on early redemption.

Acceptable Property Types

Freehold Flat No

Purpose Built Flat Yes

Converted Flat Yes

Flat Over Shop Refer

Maisonette Yes

Studio Flat No

Flying Freehold Yes

Thatched Yes

Timber Framed Yes

Concrete No

Agricultural Tie No

Flat Over 4 Storeys Refer

Listed Building Yes

Right to Buy

Max Discount% 100

Max Market Value% 90

New Build acceptable.

Ex-local authority flats and maisonettes are restricted to 70% LTV.

Will not lend on Freehold flats or Maisonettes.

Flats over certain types of commercial properties are restricted to 75% LTV.

Flats with more than 5 storeys are not considered, if they are ex local authority, or do not have lift access.

Flats with more than 10 storeys are not considered.

All property, flying freehold not to exceed 25% of the total property.

Timber properties are not normally acceptable but Coventry Building Society will consider modern timber framed

properties provided they have an outer skin of brickwork.

Steel Frame houses and all types of property <10 years with no NHBC or equivalent properties are not accepted.

Houses with 2 Kitchens and houses with no bathroom are not accepted.

Coventry Building Society will not lend in Isle of Man, Channel Island, Scottish Isles. Except Isle of Skye

For purchase applications, the vendor must have owned the property for a minimum of 6 months.

The maximum loan to value for a new build or converted apartment/flat is 75% LTV.

The maximum loan to value for a new build house is 85% LTV.

We define new builds as properties that have been built within three years of the mortgage application or are properties

to be occupied for the first time. This includes apartment/flat conversions where the number of apartments/flats in the

development exceeds ten.

Applications cannot be considered where the property offered as security is a self-build property or a self-build

conversion, where the construction or conversion of the property is not fully completed at the time of application.

We will not lend to flats above or adjacent to workshops, restaurants, take-aways, public houses, sex shops, massage

parlours and premises that stock explosive or toxic materials (fireworks, dangerous chemicals etc.).

We will not lend to flats above or adjacent to void/empty premises.

* 'adjacent to' includes properties within an 'influential' distance. This will be determined by the valuer.

For unencumbered or where there is less than £5,000 outstanding on the current mortgage the maximum LTV is limited

to 50%.

New properties must have the benefit of either:

A Professional Consultant’s Certificate which are valid for the first 6 years or

An acceptable builder’s guarantee which is valid for the first 10 years

Second hand properties less than 10 years old must normally have been built with the benefit of an acceptable Builder’s

Guarantee scheme subject to the following exception:

Where the property was built or converted within the past 6 years, the case will be acceptable if it was built with the

benefit of a Professional Consultant’s Certificate where cover was valid for the first 6 years.

A Professional Consultant’s Certificate must be for a minimum period of 6 years from the date the property was built.

Applications where solar power panels are installed on the property being purchased or remortgaged are acceptable,

subject to the valuer confirming the property is suitable security, and where the solar panels have a lease the acting

conveyance confirming that the lease is acceptable.

For New and existing borrowers where the property is in a Multi-storey, multi-occupancy residential building (flats) with

external wall systems (cladding) or external wall attachments (i.e. balconies) these are subject to review of our valuer's

who will use the latest RICS guidance on cladding.

Where the RICS guidance states an EWS1 form is required, the property is only acceptable where an EWS1 form is

satisfactorily completed by a suitably qualified professional, and the valuer confirms that option A1, A2 or B1 has been

selected and confirms that the property is suitable security.

The acceptable options and definitions are shown in the table below Option A - Where external wall materials are unlikely

to support combustion

A1

There are no attachments whose construction includes significant quantities of combustible materials (i.e. materials that

are not of limited combustibility or better)

A2

There is an appropriate risk assessment of the attachments confirming that no remedial works are required

Option B - Where combustible materials are present in external wall

B1

The fire risk is sufficiently low and no remedial works are required.

Where the valuer has noted that option A3 or B2 has been selected or no EWS1 form is available the case must be

declined. The only exception to this is where the application is for an existing customer; see Existing Customers - Further

Borrowing with an unacceptable or no EWS1 form

EXISTING CUSTOMERS – FURTHER BORROWING WITH AN UNACCEPTABLE OR NO EWS1 FORM - POLICY

Where the valuer has noted that option A3 or B2 has been selected or no EWS1 is available and the further borrowing is

for essential repairs the case should be treated on a case by case basis (refer to Lender).

Where the borrowing is not for essential repairs the application should be declined.

Accepted Locations : England, Scotland, Wales

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 Refer

Insurance

Buildings Conditional

Conditions

Min Loan

Max Loan £2,000,000

Max Portfolio of BTL Loans none

Min Age 18 years

Max Age 75 years

Min Term 1 years

Max Term 35 years

Minimum age is 18 on application

The applicant (s) must have a minimum of 1 year in continuous permanent employment. If they are in a probationary

period and it is the applicant's first job the application should normally be declined.

Additional security

required where LTV exceeds 75%.

The maximum number of applicants is 4.

Refer to Coventry Building Society for Directors' requirements.

Panel Solicitors only.

Nationality and Right of Abode requirements:

Applications from foreign nationals with indefinite leave or a right of abode to live and work in the UK can be considered

provided that:

None of the applicants hold any level of diplomatic immunity.

Each applicant must have permission to live and work in the UK.

Each applicant must have been granted indefinite leave to remain or a Right of abode to live and work in the UK. A copy

of the document confirming the right must be obtained and kept on file indefinitely.

In addition to all normal status checks, a satisfactory history of employment and residency in the UK over the last two

years must be established and verified.

The Step Up Facility is no longer available

Where applicants are self-employed and the loan amount is >=£200,000 a 3 months personal bank statements are

required.

Applications not paid in pounds sterling will not be accepted.

Standard ID requirements:

Group A - to confirm who they are

-Passport (UK or foreign) – current, valid and full

-Valid (UK or EEA) photo card driving licence (full or provisional)

-EEA member state identity card

-Full old style paper driving licence (UK) – current, signed

-DWP pension entitlement letter – valid for the current year

-Birth certificate/adoption certificate (under 18s only)

-NHS medical card/document, showing holder’s name, DOB, NHS number (under 18s only)

Group B - to confirm their name and address

-Full or provisional UK photo card or old style paper driving licence – current, signed

-Bank/building society statement – less than 3 months old and not printed off the internet. Those issued by the Coventry

are not acceptable

-House insurance certificate – valid for the current year

-Council/local authority tax bill – less than 12 months old and valid for the current year

-Utility bills (i.e. gas, electricity, water) or cable/satellite/phone bill (excluding mobile phones) – less than 3 months old

and not printed off the internet

-NHS medical card/document, showing holder’s name, DOB, NHS number (under 18s only)

Remortgages with additional lending

Max LTV 75% up to £1.25m and 65% up to £2m.

If the property is unencumbered or there is less than £5,000 outstanding on the current mortgage the maximum LTV is

50%.

Below notes concern ongoing Covid-19 situation

From 15 September 2020 we will no longer be accepting furloughed income for employed applicants. Any applications

that are already in the pipeline will not be impacted, unless customers wish to increase their LTV above 65%.

If a customer is currently furloughed we can accept their application if this is supported by a letter from their employer.

This letter should confirm that they’ll be returning to work on or before 2 November 2020, their annual salary from this

date and that there have been no changes to the terms and conditions of their employment.

Applications on zero hours contracts accepted from the following key workers

-NHS bank nurses and locums

-Non-NHS bank nurses

-Care home workers

-Supermarket workers, including delivery drivers

-Retained/on-call firefighters and Armed Forces Reservists using zero hours income criteria.

Cryptocurrency is an unacceptable form of deposit including where it has been converted back into sterling.

The property must be insured by you in accordance with the conditions of this mortgage, The level of buildings cover

must be no less than the rebuilding cost of the property.

Foreign Citizens Refer

Ex-Patriates Not Accepted

Income

Based on Income > 0

5 + 5 or 5 joint < 50% LTV

4.49 + 4.49 or 4.49 joint < 95% LTV

Min months in current position 1

Min months in continuous service 12

Min no. of years accounts 2

Average years taken to calculate income 1

Will consider declining profit Refer

Outgoings

It is important that all applicants can afford to repay their mortgage before we enter into a regulated mortgage contract

with them, and we take a range of factors into account to determine how much an applicant can borrow.

Our affordability assessment aims to ensure that, after the mortgage payment has been made, there is sufficient net

income remaining to cover financial commitments and additional outgoings, including general household and lifestyle

costs. We will also consider the impact of possible future interest rate increases on the long term affordability of the

mortgage.

The actual loan amount will be subject to: a full credit score, affordability assessment, review of current credit

commitments and our current lending policy.

Lending into Retirement;

Applicant(s) who are currently employed or self-employed (i.e. not yet retired) and the mortgage will continue when the

applicant(s) retire(s) and will have:

5 years or more of the mortgage term in retirement or, 50% or more of the mortgage term in retirement

The lower of current income or anticipated retirement income (both must be net of any on-going commitments) will be

used to calculate the maximum monthly payment and maximum loan amount.

If proof of acceptable income past retirement age cannot be provided then the loan term will be restricted to the

retirement age (maximum age 70).

If you would like to discuss individual cases in more detail, please call our Intermediary Team

For employed applicants:

Backstop Income Multiple:

For joint applications where the applicants have at least 20 years before reaching our maximum lending age, the current

income multiples are dependent on the LTV of the application and the applicants’ gross income.

New Mortgages.

LTV Limits. Income Multiple within the affordability calculator.

<=50% 5 x

>50% to <=65% 4.49 x

>65% to <=75% 4.49 x

>75% to <=90% 4.49 x

>90% 4.49 x

For applicants within 20 years of our maximum lending age at the date of the application, a reduced maximum income

multiplier will be applied to take into account the reduced mortgage term that is available as in the table below:

New Mortgages

Time to Maximum Lending Age. Income.

<=£40,000 >£40,000

16 to 19 years 3.2x 3.4x

11 to 15 years 2.6x 3x

6 to 10 years 2x 2.2x

0 to 5 years 1.2x 1.2x

Proof of Income for Employed & Employed – Furloughed income

Acceptable Levels:

Basic Salary – 100%

Regular overtime, bonuses, shift allowance or commission – 50%

Annual Bonus - 50% of the average of the latest 2 years annual bonus, or 50% of the most recent years annual bonus

figure, if lower

Annual non-pensionable allowance forming an integral part of the remuneration package – 100%

Proof:

Latest P60 and last payslip (latest P60 is not required for further advances)

Latest 2 month’s bank statements (first time buyers only)

Where Regular overtime, bonus, shift allowance or commission is being used for affordability, -

Where it is identified that the applicant is employed by a family business or a family member 2 month’s bank statements

must be obtained.

Where the latest P60 is not available the latest 3 monthly or 12 weekly pay slips are acceptable.

Evidence of income must provide a record of employment covering the last 12 months

For applicants who have been in their current employment for less than 6 months, the latest P60 and last payslip are

normally sufficient to prove employment and earnings but a previous employer’s reference should be obtained if the

underwriter considers it necessary.

Maternity / Paternity income;

Where an applicant is on maternity/paternity leave, the income that they expect to receive after their leave should be

used when calculating affordability. The applicant’s plans to repay during maternity/paternity leave should be determined.

Where the customer advises they will return to work on the same terms, the normal (pre-parental leave) income can be

used.

The applicants latest P60 and payslip prior to going on parental leave and the most recent payslip which shows the client

is on parental leave e.g. Statutory Maternity Pay information should be obtained.

Where the customer advises they will return to work on reduced hours, the reduced income should be used.

An employer’s reference is required to confirm this.

Self employed applicants;

Directors with a 20% share or more in the company they work for:

We will request an Accountant's Certificate directly from the accountant on submission of the application.

At the point of application proof of income must be no more than 12 months old.

We may request bank statements on submission of the application.

Max LTV for Capital raising 65%

Please note we only accept accounts audited by the following professional accountancy bodies:

Institute of Chartered Accountants (ICA)

Association of Chartered Certified Accountants (ACCA)

Chartered Institute of Management Accountants (CIMA)

Institute of Financial Accountants (IFA)

Association of Authorised Public Accountants (APA)

Chartered Institute of Public Finance & Accountancy (CIPFA)

Chartered Institute of Taxation (CIOT)

Association of International Accountants (AIA)

For Sole Traders, Partnerships, Sub-contractors:

Latest two years tax assessments (SA302s*)

At the point of application proof of income must be no more than 15 months old.

We may request bank statements on submission of the application.

*SA302s must be official and are not acceptable where they are printed from the HMRC website.

We may request further information/clarification directly from the applicant's accountant - please ensure full contact

details are provided.

Contracted Personnel

There must be a minimum of 6 months remaining on the applicant's existing contract. Where there is less than 6 months

remaining, then evidence of 24 months continuous employment in the same profession is required.

To prove income the lender will need the following:

Contracts demonstrating continuous employment in contracting over the last 12 months.

An employer's reference giving full details of the current contract.

Where there is less than 6 months remaining, then evidence of 24 months continuous employment in the same

profession is required.

For zero hour contracts, documentary evidence confirming a consistent level of earnings over the last 12 months.

Daily Rate Contractors

Continuous contracting history over the last 12 months.

There must be a minimum of 6 months remaining on the existing contract. Where there is less than 6 months remaining,

then evidence of 24 months continuous employment in the same profession is required.

To prove income the lender will need the following:

Copies of contracts demonstrating continuous employment in contracting over the last 12 months.

There must be a minimum of 6 months remaining on the existing contract. Where there is less than 6 months remaining,

evidence of 24 months continuous employment in the same profession is required.

Latest two months personal bank statements (First time buyers only)

Income must be equal to or greater than £50,000 (gross) based on the following calculation :Daily Rate x 5 x 41

We have added the following onto our list of acceptable sources of income:

Colleague flexible benefit

Additional duty hours

Flight pay allowance

Nursing bank

Shift allowance

Car Allowance is an acceptable form of income provided it is an integral part of the salary package and that it is not a

refund of expenses already paid out by the applicant.

UNACCEPTABLE SOURCES OF INCOME:

Income from temporary employment

Child/working family tax credits

Disability allowances

All other state benefits

Maintenance (including court ordered)

Bursaries and other educational subsidies

Foster income

Rental income where it is secondary income, expect where the applicant can confirm that the income is derived from a

business, can provide 2 years accounts (1 year Buy to Lets) or two SA302s and meet all other self employed criteria

Please note that this list is not exhaustive and any similar income source may be declined.

Total gross income is made up of:

For applicants currently employed/self employed and where the mortgage term will go into retirement.

Pension Projection

Private pension - Annual statement of pension due on retirement (including pension projection) or Letter from the

pension provider confirming pension due on retirement.

State retirement pension (SRP) - Annual statement of pension due on retirement

or Letter from the Department for Work and Pensions (DWP).

Company/ Occupational pension - Annual statement of pension due on retirement

or Letter from the employer/ pension provider confirming pension due on retirement.

For fully-retired applicants:

State retirement pension (SRP) - At least one of the following is required: Latest two month's bank statements showing

monthly pension payment or Latest annual letter from the Department for Work and Pensions (DWP)

Private pension - At least one of the following is required: Latest two month's bank statements showing monthly pension

payment or Annual pension statement.

Company/ Occupational pension - At least one of the following is required:

Latest pension slip or two month's bank statements showing monthly pension payment or Latest annual statement from

the pension provider.

Drawdown on pension fund - Annual statement of benefits from the pension provider.

Interest income from investments - Latest two year's tax assessments (SA302s*).

Dividend income from a portfolio of shares that owns a share in a business (100% of dividends will be acceptable) -

Latest two year's tax assessments (SA302s*).

Income from a company the applicant owns that continues to provide an income in retirement - Latest two year's tax

assessments (SA302s*).

Rental income from a mortgage-free property - Latest two year's tax assessments (SA302s*).

Pension documents provided must be no more than 12 months old.

Pension statements must be from the pension provider.

We reserve the right to request an accountant's certificate to finalise our lending decision.

Income from Umbrella companies:

Coventry Building Society will potentially consider contractor income that is paid via an umbrella company. Applicants

paid via an Umbrella company are acceptable subject to meeting our Daily Rate contractor or Contracted personnel

criteria.

Below notes concern ongoing Covid-19 situation

Hire Purchase Taken into account

Personal Loans Taken into account

Overdraft Taken into account

Credit/Store Cards Taken into account

Child Maintenance Taken into account

Child Education Taken into account

Extra Income:-

Other Income - Guaranteed Add 100% to income before multiply

Other Income - Regular Add 50% to income before multiply

Other Income - Irregular No

Investment Income No

Mortgage Subsidy Add 100% to income before multiply

Large Town Allowance Add 100% to income before multiply

Maintenance Payments No

Non Contributory Pension Add 100% to income before multiply

Car Allowance Add 100% to income before multiply

Adverse Credit

CCJs/Defaults : Accept:

1) Max £500.00 in Defaults. These must be fully paid. This condition does not incur any rate loading.

2) Max £500.00 in CCJs. These must be fully paid. There must be no CCJss in the last 6 months. This condition

does not incur any rate loading.

3) Max £250.00 in Defaults unsatisfied. This condition does not incur any rate loading.

4) Max £250.00 in CCJs unsatisfied. There must be no CCJss in the last 6 months. This condition does not incur any

rate loading.

Arrears : Accept:

1) Max 1 missed payment in the last 36 months, which may be unpaid at the time of application. This condition does

not incur any rate loading.

Bankruptcy/IVAs : Accept:

1) IVA must be discharged at least 6 years prior to application. This does not incur any rate loading.

2) Bankruptcy must be discharged at least 6 years prior to application. This does not incur any rate loading.

Repossessions : Not accepted.

CCJs over 3 years old considered on an individual basis.

Defaults on Mortgages and secured loans must be satisfied

Defaults over 3 years old, less than £1500 satisfied or not considered on an individual basis.

IVA and Bankruptcy not acceptable for FTB