Mortgage Lending Criteria

For lending at or below 80% LTV, we will assess based on the customers current income where they are on/or have recently been furloughed or had any COVID-19 related deductions from their salary/income. This will need to be supported by a letter from the employer to confirm the terms of their furlough or changes to pay, the date they return to work and confirmation of their pay at this point. 

For lending over 80% LTV, customers on/or have recently been furloughed or had any associated COVID-19 related deductions from their salary/income will not be accepted. For self-employed this includes any SEISS grants received in the last 6 months. To be considered for an LTV above 80%, employed applicants need to be back at work for 3 months without COVID-19 related reductions.

18 – for Residential; 21 for Buy to Let.

Residential - 80 years old at the end of term, standard affordability assessment.

• Borrowers who are over 80 years old at the end of the term will be considered on an individual basis

Buy to Let – 85 years old at the end of term, standard affordability assessment.

If the applicant is already retired or retiring during the mortgage term, the following is required:

• Detailed assessment of how the applicant will repay the mortgage in retirement e.g. from a company/private pension.
• Documentary evidence to demonstrate the retirement income.

All applicants must have been in the UK for the last 3 years.

Not accepted.

Defined as an applicant who has never owned a residential property in the UK. On joint applications, this applies to all applicants.

Not accepted, can consider joint borrower/sole proprietor for both Residential and Buy to Let applications.

Accepted, only where the additional borrower(s) are close and immediate family members.

The definition of close and immediate family includes spouses, parents, grandparents, children, grandchildren, siblings and mother/ father/ brother/ sister/ son/ daughter in law.

Adopted, half, and step members are also included in the definition. Independent Legal Advice required for all parties. On a Residential mortgage the Joint Borrower cannot reside in the property. Joint Borrower/Sole Proprietor is not available for capital raising unless for the benefit of all parties.

Maximum of 2 households only (including the security property household on completion). 2 households needs to be selected as part of the application and expenses from both households need to be included.

Not accepted.

Maximum of four applicants. For Residential mortgages for more than 2 applicants, the additional applicants must meet the close and immediate family definition.

The definition of close and immediate family includes spouses, parents, grandparents, children, grandchildren, siblings and mother/ father/ brother/ sister/ son/ daughter in law.

Adopted, half, and step members are also included in the definition. For Professional Mortgage Range applications, we accept a maximum of 2 applicants that both reside/will reside in the subject property.

For Buy to Let mortgages, a maximum of 4 applicants (unrelated applicants accepted).

Must supply 3 years UK address history and currently be resident in the UK. All applicants must have either settled or pre-settled status unless they are Irish citizens or have indefinite leave to remain/enter the UK. Tier 2 Visas considered (Maximum LTV 75%), minimum income £75,000, Capital and Interest loans only. Proof of Sponsorship required

Affordability calculation needs to cover both mortgage balances.

For employed applicants, the minimum time in current employment is 3 months unless there is a strong track record in the same line of work, with a minimum time in continuous employment of 12 months. Income level should be sustainable. 

Probationary period acceptable subject to conditions, dependent on career history.

We use 50% of cash bonus/commission/overtime from the latest/current year.

We will use either

• The latest P60 minus the basic and fixed allowances
• Or the basic and fixed allowances year to date
• Or the Bonus payslip for the current year supported by the year to date figure.

Accepted at 100% of the fixed regular amount if contracted as permanent.

Accepted at 100% of the fixed regular amount

Not accepted.

Accepted at 100% of the fixed regular amount

Accepted – 100% of basic and fixed acceptable allowances if 12 month track record and sustainable. P60 for this employment will be required to evidence earnings in addition to last 3 payslips.

Not accepted.

Not accepted.

SIPP Income - Accepted at 5% of the fund value, over a maximum term of 20 years, this can be considered even if not currently being drawn if the customer is over age 55. If fund contains a property the value of the property will be excluded. A Current Annual Investment Portfolio Report will be required.

SSAS Income - Accepted, at 5% of the fund value, over a maximum term of 20 years, this can be considered even if not currently being drawn if the customer is over age 55. Refer for additional requirements. Typically Accounts and Investment Portfolio Reports are required.

Accepted at 5% of fund value over a maximum term of 20 years - subject to a minimum managed portfolio value of £250,000. Single stock or funds with individual properties will be excluded.

Accepted, 100% of latest year. The useable income is calculated as profit from land and property after removing any dis-allowable expenses - such as finance costs. To be evidenced via most recent SA100 (submitted tax return) with Inland Revenue (IR) mark paired with the tax year overview. Where the disallowed expenses/finance costs section (Box 40 minus Box 44 of rental section on SA100) is blank the BTL mortgage payment should be added as a commitment.

Lodger’s income not accepted.

Accepted, if guaranteed for the life of mortgage.

Not accepted.

Accepted, must be guaranteed for term of mortgage, refer for additional requirements. Trust documents will be required, including evidence of trust assets - typically Trust Accounts and Investment Portfolio Reports.

Not accepted.

Not accepted.

Not accepted.

Accepted if granted for life.

Not accepted.

Accepted.

Classed as self-employed if own 25% or more of business this includes PAYE Directors that hold 25% or more.

6 months business bank statements are required on all self-employed cases to confirm the sustainability of the business.

Accepted. Treated as self-employed.

Minimum of 3 years SA100 (tax returns) with Inland Revenue mark required. Where the return is submitted by an accountant, the calculation or computation and tax year overview can be accepted and will need to be supported by a covering letter on headed paper from the accountant (see accountant qualification section) confirming the attached figures have been submitted to HMRC.

Director’s remuneration plus average dividend for last 2 years is used for affordability where the ongoing sustainability of drawings can be evidenced.

Profit before taxation averaged over last 2 years plus directors remuneration can be considered for affordability if 100% of shareholders are on the mortgage and sustainability of the business can be confirmed.

2 years full company accounts submitted and registered with Companies House required to support application. Minimum of 3 years SA100 (tax returns) with Inland Revenue mark required. Where the return is submitted by an accountant, the calculation or computation and tax year overview can be accepted and will need to be supported by a covering letter on headed paper from the accountant (see accountant qualification section) confirming the attached figures have been submitted to HMRC.

Main accountants’ qualifications accepted.

- Institute of Chartered Accountants England & Wales

- Institute of Chartered Accountants Scotland

- Chartered Institute of Management Accountants

- Association of Chartered Certified Accountants

- Chartered Institute of Public Finance and Accountancy

- Institute of Financial Accountants

-Association of Accounting Technicians

Accepted. Minimum 3 month current contract and history of contracts of at least 12 months required with no more than 6 weeks of gaps in contracts. Contracts must have a start and end date. If current contract is nearing its end we may require evidence that it has been renewed. Income calculated as a daily rate over a maximum of 46 weeks based on 5 day working week (unless the contract restricts the applicant to less than this). We require evidence of the current contract, 12 months contract history and 6 months Bank statements showing receipt of contract income at level keyed. A 12 month history is not required for applicants who can evidence 24 months continuous history working within the same industry as evidenced by P60’s.

Temporary and fixed contract accepted where income can be evidenced over a 24 month period in the same industry. Income will be assessed as guaranteed income (hourly/ daily rate multiplied by guaranteed hours/ days). We require evidence of current contract, 12 months contract history and 6 months Bank statements showing receipt of contract income at level keyed. Where applicant does not have a 12 month contract history please provide last 2 P60s showing continuous employment in the same industry.

Not accepted. This includes contracts without an end date or conformation of hours to be worked.

This product is for fully qualified, registered and practicing Solicitors, Barristers, Medical Doctors, Accountants, Actuaries, Vets, Dentists, Surveyors, Architects and Engineers for purchase or remortgage applications. Capital raising is accepted.

• We can offer enhanced income multiples (normally we offer 4.49 times the customer’s income but for the professional mortgage we can offer 5.5 times their income - subject to affordability)
• The customer must be over 21 years of age
• Applicants accessing this range due to being from an accepted profession must have qualified in the last ten years and be registered with the appropriate UK professional body. They must also work in the field related to their profession
• We will consider professional applications for up to two applicants only, at least one applicant must meet our professional criteria. Applications may be considered where a ‘non-professional’ has the highest income and subject to full case review
• Joint borrower, sole proprietor not accepted and available on prime residence only

Registered bodies

We can only accept applications for the Professional Mortgage if the customer is registered with the following:

Barristers

- The Bar Council

Actuaries

- The Institute and Faculty of Actuaries (IFoA)

Accountants

- Institute of Chartered Accountants England & Wales

- Institute of Chartered Accountants Scotland

- Chartered Institute of Management Accountants

- Association of Chartered Certified Accountants

- Chartered Institute of Public Finance and Accountancy

- Institute of Financial Accountants

Medical Doctors

- General Medical Council

Solicitors

- Law Society of Northern Ireland

- Law Society of England & Wales

- Law Society of Scotland

Dentists

- General Dental Council (GDC)

Vets

- Royal College of Veterinary Surgeons (RCVS)

Engineers

- Institute of Engineering and Technology Incorporated Engineers (IEng)

- Institute of Engineering and Technology Chartered Engineers (CEng)

Surveyors- Royal Institute of Chartered Surveyors (RICS)

Architects- Architects Registration Board (ARB)

Note: Professionals employed in a role without their qualification as their job title will be considered on an individual basis. E.g. a fully qualified accountant working as a senior finance manager would be considered for a Professional Mortgage.

• High Income Earners can use a product from our Professional Mortgage Range, where a sole applicant can demonstrate ‘earned income’ of £100,000 and above and joint applicants of £150,000 and above per year.
• Earned income is that from employment, all types of self-employment including Limited Company’s and Contractors that is acceptable in accordance with our lending criteria, please refer to the relevant sections of this guide for further information.  
• For a joint application where the income does not exceed £150,000 but one applicant earns more than £100,000 are accepted, however the second applicant’s income will not be used for affordability.
• We can offer enhanced income multiples (normally we offer 4.49 times the customer’s income but we can offer 5.5 times their income - subject to affordability).
• The customer must be over 21 years of age.
• We accept a maximum of two applicants residing/looking to reside in the subject property.
• For purchase or remortgage applications. Capital raising is accepted.
• Joint borrower, sole proprietor not accepted and available on prime residence only

Accepted - classed as contractors. Refer for assessment.

Only if long term track record – average of last three years’ earnings.

Return to work salary as evidence by employer letter and the last payslip before leave, providing there is sufficient income/savings to cover any reduction in income during leave period. Employer’s letter needs to confirm return to work date, income, hours and no change in terms and conditions of employment. Last payslip before leave is also required.

Other income sources should be evidenced alongside savings that may supplement any income loss during this leave. We may request additional information or documentation to support this.

Income or Assets generated or held in a currency other than (£) sterling are not accepted for the purpose of Affordability or Repayment Strategy.

Need to demonstrate that any Buy to Lets are self-financing (the rental exceeds the mortgage payment), One months' bank statements required to show rental and mortgage payments.

Accepted, completion will need to be simultaneous with onward residential purchase.

Where a client applies for a residential purchase mortgage but will be letting their old residence out (rather than selling), the old main residence mortgage will be ignored if an ARLA letter shows rent will cover the mortgage repayments once the client moves out. If a new mortgage is being taken out on the property, a Mortgage Illustration will need to be provided and the rental need to cover the new mortgage payment. Evidence of consent to let may be requested when existing mortgage is being retained on residential terms.

Evidence of consent to let maybe requested when existing mortgage is being retained on residential.

Accepted, refer for details.

Treated as running 2 houses and affordability calculation will take into account both mortgage (if applicable).

Any debts remaining on completion are included in expenditure as part of the affordability calculation, including credit card balances at 3% are included in the affordability calculation. Any debts with less than 3 months to run can be ignored, this will need to be evidenced.

Taken as commitment.

Mainland England, Wales and Scotland.

For Scotland we will not lend in the following postcodes:
Aberdeenshire (AB)
Western Isles (HS)
Highlands (IV, KW & ZE)

A Standard Mortgage Valuation will be required in all cases.

Due to COVID-19, there are areas of the UK that are or may become subject to lockdowns at a localised level. There may also be scenarios where we are unable to access properties due to residents of the household ‘shielding’. In these situations we may only be able to utilise Automated Valuation Models (“AVM”) and procure Digital Valuations up to £3m.

£75,000 for both Residential and Buy to Let properties.

Not accepted.

Accepted, if used by own family/dependant relative.

Not accepted.

Accepted - subject to surveyor’s comments that the property and location does not adversely affect saleability.

Accepted, with durable outer leaf, subject to surveyors comments on marketability and the suitability of the security for mortgage lending.

Not accepted.

Accepted, subject to surveyor's comments. A note should be added at application to confirm the property has a thatched roof.

Accepted, subject to a satisfactory structural engineer’s report and surveyors comments on marketability and the suitability of the security for mortgage lending.

Not accepted.

Not accepted.

Category 1 - Acceptable. Japanese Knotweed was not seen on this property, but it can be seen on a neighbouring property or land where it was more than 7 metres away from the boundary.

Category 2 - Acceptable. Japanese Knotweed was not seen within the boundaries of this property, but it was seen on a neighbouring property or land. It was within 7 metres of the boundary, but more than 7 metres away from habitable spaces, conservatory and/or garage of the subject property.

Category 3 and Category 4 - Unacceptable unless appropriate treatment plan provided by a company affiliated to either the Property Care Association Invasive Weed Group or the Invasive Non-Native Species Association (INNSA) in place. The treatment plan must be paid for in full prior to Metro Bank releasing funds and benefit from a 5 year warranty/ insurance backed guarantee.

Not accepted - property has to be secure; structurally sound; insurable; have a working kitchen with running water, storage and ability to heat food; have a working bathroom with working lavatory, sink and ability to shower or bath.

Houses accepted. Flats accepted subject to a maximum number of stories in the block of 6. Deck access accepted subject to surveyor's comments. A note should be added at application to confirm the property is ex local authority and/or has deck access.

No Maximum. Above 4 Stories requires a lift.

Not accepted.

Accepted on Residential mortgages for up to 90 days per annum.

Accepted, if in Granny annex (see above), otherwise not accepted.

Minimum 50 years unexpired term on lease at end of mortgage term, subject to valuers comments. Escalating Ground rents

• New builds/conversions must have an initial minimum lease term of 125 years;
• The maximum initial ground rent should initially be no more than 0.25% of market value;
• The ground rent must not be reviewed less than every 10 years;
• The ground rent must only be reviewed in line with the RPI or equivalent;
• Event fees can only be based on the reasonable administration costs incurred.

Grade I, II* and II (A, B and C in Scotland) accepted - subject to full valuation and surveyor’s comments.

Not accepted.

Accepted - subject to:

• Planning and building regulation compliance.
• An acceptable building standards warranty scheme being available.
• Buildings insurance being obtainable under normal terms.
• A minimum design life of 60 years as confirmed by a British accredited body (i.e. BRE, BOPAS).
• Saleability confirmed by the surveyor
• Being situated in a suitable location as defined by the surveyor

Property built/converted in last 12 months (based on completion certificate) and being occupied for the first time.  

Properties that have been built or converted in the last 10 years require suitable warranties/guarantees to be in place. A list of which is available on the UK Finance website www.ukfinance.org.uk.

90% LTV for Residential, 80% LTV for Buy to Let.

90% LTV for Residential, 80% LTV for Buy to Let.

Builder Incentives accepted up to 5% of the purchase price. Builder incentive can include builders gifted deposit, white goods, carpets and curtains, cashback, legal fees and a contribution towards stamp duty.

Remortgages of recently purchased properties will only be accepted if 6 months has elapsed since completion of purchase.

Not accepted.

Not accepted, unless completed and covered by a suitable structural new build warranty.

Accepted, providing no lease agreement exists.

Accepted for residential, not accepted for BTL.

Minimum Gross External Area (GEA) of 35m²

See product guide.

Not accepted.

Not accepted.

Not accepted.

Not accepted.

Accepted.

Not accepted.

Not accepted.

Accepted if for own use (max 85% LTV). We will accept up to 75% LTV on Interest Only (with sale of property as a repayment strategy) with an additional 10% on capital repayment.

Affordability calculation needs to cover both mortgage balances.

For interest only applications where the sale of the security is the repayment strategy the minimum property value requirement does not apply (see Acceptable Repayment Strategy section). If for a Dependent Relative please refer to the specific section).

Accepted if for dependant relatives use (max 85% LTV). We will accept up to 75% LTV on Interest Only (sale of property is not suitable as a repayment strategy) with an additional 10% on capital repayment (see Acceptable Repayment Strategy section).

Affordability calculation needs to cover both mortgage balances.

5 years.

35 years

£50,000. Additional borrowing applications have a £500 minimum loan amount.

Loans considered up to any level (max interest only 75% on Residential mortgages and 80% on Buy to Let mortgages).

Deposit must be from own resources unless gifted by a close family relative for both Residential and Buy to Let applications. The definition of close and immediate family includes spouses, parents, grandparents, children, grandchildren, siblings and mother/ father/ brother/ sister/ son/ daughter in law. Where deposit is gifted, the donor must complete the Gifted Mortgage Deposit Form to confirm a sum of money is being gifted towards a deposit on a property. Additional evidence of funds may be requested.

Accepted, subject to interest only policy. Maximum LTV 85%.

Credit search and score obtained.

Equifax

• Sale of mortgaged property
• Part Interest Only and Part Capital Repayment is permitted
• Total allowable on Interest Only 80%.

Earned income from up to 2 applicants can be considered to support buy to let applications where the rental income is equal to, or greater than, 100% cover of the mortgage interest amount calculated at Metro Bank’s 5.5% stress rate and the customer(s) have a minimum income of £50,000 for a single application, or £75,000 for a joint application. (Income from rent is not permitted to support top-slicing).

Top-slicing is not accepted on 5 year fixed rates (please see table under 'Rental Calculation').

You are required to complete a budget planner and upload it at AIP stage, we then use this to ensure the disposable income exceeds the rental shortfall of the property or portfolio.

Minimum of one applicant must be an owner-occupier. First Time Landlords accepted (exceptions considered if in work related accommodation).

No minimum income required, (unless using top slicing, see section above), one applicant must be earning an income other than rental. An assessment of funding living expenses and rental voids will be made.

Maximum of 5 properties with Metro Bank (under £5m aggregated debt), maximum of 10 properties in total. These limits also apply for existing customers seeking a further advance.

Max 80% LTV for both houses and flats.

Single AST (or Short Assured Tenancy/Private Residential Tenancy in Scotland) required of no more than 36 months which must contain an annual break clause) and be regulated by the Housing Act 1988. Single household only - Multiple tenancies not accepted. Other forms of tenancy are not acceptable, for example Common Law Tenancies,  typically used when letting to a company,  where the annual rent is more than £100,000 or where the landlord is a resident.

Maximum of 5 individuals forming a single household. Family member, corporate, housing associations, HMOs, student lets, holiday lets and individuals with diplomatic immunity are not accepted.

Proof required via 3 months bank statements. Rent received in cash is not accepted. Income from rent is not permitted to support top slicing.

Considered upon request. Mortgage must have been with Metro Bank for a minimum of 12 months.

We class a Consumer Buy to Let mortgage as an application where all applicants do not own other Buy to Let properties and since becoming the owner of the proposed security property the customer or their family members have lived in the property (e.g. the customer is completing a Let to Buy transaction or has inherited a property and resided in it prior to letting it out).

This is classed as any Buy to Let application where the applicants will own either in sole name or jointly, the sum of 4 or more Buy to Let properties with mortgages on completion, this includes any Buy to Let properties owned in Limited Companies where the applicant(s) holds a personal guarantee.

Top-slicing is not accepted on 5 year fixed rates (please see table under 'Rental Calculation').

In these cases, further documentation will be required and sustainability of the portfolio reviewed.

For the additional document requirements please refer to the useful documents section of the intermediary website, where you will find both the Buy to Let Business Plan and the Buy to Let Requirements documents.

Required confirming that an energy performance indicator of no less than E is in place (applicable to properties located in England & Wales only).