Mortgage Lending criteria
Product
4.89% Fixed to 31/07/2013
Notes: We have not verified this information with the lender. Ask us to confirm any aspects that are important to you. The main features of this mortgage will be confirmed in the Key features Illustration. Please ask your broker for a Key features Illustration
back to buy to let best buys
back to buy to let best buys
Product
4.89% Fixed to 31/07/2013
5.1% Variable
Advances
Upto £500,000 (Remortgage only LTV 75)
Notes
Mortgage NOT portable
COMPLETION DEADLINE 29/07/2011.
- Mortgage is NOT for First time buyers
Free Legal
Product is subject to availability of funds and withdrawal at any time.
At least one applicant must be employed or self-employed as defined below.
Employed applicant(s):
Applicant(s) must be in permanent non-probationary employment. Applicant(s) on long term contract work will be considered on an individual basis.
Self employed applicant(s):
Applicant(s) who work on a subcontract basis will be treated as self employed.
An applicant will be classed as self employed where the individual owns 20% or more shareholding of the company or is employed by a family business.
Applicant(s) must have been trading in their present business for a minimum of 2 years.
Where the identity of all applicants cannot be established through the underwriting process, proof of identity verified by the solicitor or mortgage broker will be required. For Accepted accountancy institutes please refer to Lender.
The Lender reserve the right to request additional information or references such as an accountant’s reference, employment reference, mortgage statements or a bank reference. Such information may be renewed if completion does not take place within 6 months of them being obtained.
Free Valuation - remortgage only
Free legals using Paragons nominated solicitors.
There is no overpayment facility with this product.
Buy to Let : Accepted, Max properties 5
Capital Rest Period : Monthly
Repayment Types
Repayment Yes
Endowment Yes
PEP Yes
Pension Yes
Interest only (no RV) Yes
With Profits Yes
Unit Linked No
ISA Yes
Split Repayment Yes
Fees
Arrangement : £1% Can be Added
Booking : £99 Upfront
Early Repayment Charges
5% of loan to be paid until 31/07/2013
Higher Lending
None
Valuation
Basic:
Free
Min Valuation £75000
Fees can be added to the loan but are excluded when calculating LTV.
Booking Fee - payable upfront.
Mortgage Trust will nominate and instruct a firm of solicitors to act for general conveyancing and pay costs and disbursements. Any additional work, that incurs a cost will need to paid by the borrower.
At completion we require a valuation report no older than 3 months. If a re-valuation is required this will be at the applicants expense.
Acceptable Property Types
Freehold Flat No
Purpose Built Flat Yes
Converted Flat Yes
Flat Over Shop Refer
Maisonette Refer
Studio Flat Refer
Flying Freehold Refer
Thatched Consider
Timber Framed No
Concrete No
Agricultural Tie No
Flat Over 4 Storeys Refer
Listed Building Refer
Not Accepted
A lending limit of £1,000,000 and no more than 5 properties applies across all Paragon Group mortgage products
We will take a first legal charge and will only consider single self contained properties in England and Wales. Houses in Multiple Occupation and multi-unit blocks are not acceptable.
Let property
Property may either be let:
- on an assured shorthold tenancy subject to a minimum term of 6 months and a maximum of 12 months
or
- to a limited company registered in England, Wales or Scotland for up to 3 years or to a local authority or housing association for up to 5 years provided it is subsequently occupied by a private individual or individuals whose rights of occupation do not extend beyond the term granted to the acceptable tenant, (in both cases being pre-approved by us and being on appropriate terms).
Property shall not in whole or in part be let to or occupied by:
- the applicant, or any member of their family
- the guarantor, or any member of their family
- the vendor of the property, or any member of their family
- any previous owner of the property, or any member of their family
- an employee of the applicant
- an associated subsidiary, or parent company of the applicant
Sale-and-rent-back arrangements are not acceptable.
Holiday lets are not acceptable.
Where a tenancy agreement pre-dates the completion of the loan then the solicitor acting must ensure that our interests are fully protected.
Property exclusions
Property is unacceptable if it is:
- a freehold flat or maisonette in England and Wales
- designated as defective under any housing legislation
- subject to agricultural or other planning restrictions
- subject to notice of mineral extraction, contaminated land or previous mining subsidence and landfill
- an ex-local authority property
- being purchased under the right to buy scheme
- built within the last 10 years without an NHBC certificate or other guarantee acceptable to us
- non-traditional construction such as concrete or timber or where existing or possible structural defects are apparent
- a shared ownership property
- located within either 10 metres of an electrical sub-station or 100 metres of an overhead high voltage cable or communication mast.
- a flat in a block over 4 storeys high (except within Greater London)
- a studio flat, under 30 square metres
- a new or recently built flat where there is, or is likely to be, a low demand from tenants
- a property which is attached to, or is, part commercial
- a property with an element of - flying freehold
- a self-build property
- a property with restrictions relating to sale or occupancy eg section 106 notice
- a property subject to chancel repairs/liability
- a property subject to issues identified by an environmental search
- a converted flat where the applicant occupies a property in the same building.
Occupation
Depending on the specific conditions of each loan, the property must either be occupied by acceptable tenants, or may be vacant between lettings for up to 90 days, subject to the terms of the insurance cover being complied with.
Accepted Locations : England, Wales
Requirements
Bank Statements No
At Least 3 Months Pay Slips Yes
P60 Yes
Proof Of Residency No
Life Policy To Be Assigned No
Previous Lender References No
Insurance
Buildings Conditional
Conditions On Loan
Min Loan £30,000/Rmg £30,000
Max Loan £500,000/Rmg £500,000
Max Portfolio of BTL Loans £1,000,000
Min Age 21 years
Max Age 80 years
Min Term 5 years
Max Term 25 years
Applications will be considered for a maximum of two individuals who should have been resident and liable to tax in the UK for a minimum of the last 2 years.
Applications from limited companies are not acceptable.
All applicant(s) must have indefinite leave to remain in the UK.
Applications from expatriates will not be accepted.
At least one applicant must be the owner of a residential property or residential investment property.
Applications will not be accepted where the property is being purchased or refinanced through, or where the applicant is in anyway connected to, a property investment club or syndicate.
In all cases intermediaries are required to collect evidence of income. We may ask for this evidence to be provided as part of the application process on any individual case.
Age at application:
Minimum: 21 years
The applicant(s) should not be over 65 years of age at the application date.
The applicant(s) should not be over 80 years of age at the end of the mortgage term.
Where building insurance is not arranged with Paragon a fee of £25 will be charged and is normally added to the loan on completion of the mortgage.
Foreign Citizens Not Accepted
Ex-Patriates Not Accepted
Income Multipliers
Based on Income > 0
Refer to rental income calculations
Min months in current position none
Min months in continuous service none
Min no. of years accounts 2
Average years taken to calculate income 2
Will consider declining profit Refer
Outgoings
Applicant(s) should have a minimum combined gross annual income of £40,000 per annum.
In respect of self-employed income:
Last 2 years accounts prepared by a qualified member of an accountancy body acceptable to Paragon or last 2 years self-assessment tax returns plus HM Revenue and Customs (HMRC) approval form SA302 or SA300 (if HMRC calculated) or SA310 (if self-calculated).
The gross rental income from the property should equal or exceed the Interest Coverage Ratio requirements as defined within the selected product criteria subject to an absolute minimum coverage of 125%
Applicants may be subject to validation of the income requirements detailed above. Intermediaries should obtain and hold on file proof of income in all cases.
Applicant(s) must be in permanent non-probationary employment.
Minimum months in current employment please refer to Lender.
Minimum months in continuous employment please refer to Lender.
Hire Purchase NOT 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 NOT Taken into account
Extra Income:-
Other Income - Guaranteed Add 50% to income before multiply
Other Income - Regular No
Other Income - Irregular No
Investment Income No
Mortgage Subsidy No
Large Town Allowance Add 100% to income before multiply
Maintenance Payments No
Non Contributory Pension No
Car Allowance No
Remortgage Max LTV
Capital Raising 75%
Home Improvements 75%
Debt Consolidation Not accepted
School Fees Not accepted
Holidays/Cars Not accepted
Buy Other Property 75%
Business Purposes Not accepted
Divorce Settlement Not accepted
Unencumbered 75%
Where the applicant(s) has been the registered owner(s) of the property for less than 6 months, the loan amount will be based upon the lower of the purchase price or current valuation. Exceptions will be considered where it can be demonstrated, that since the date of purchase, significant improvement works which have enhanced the property value have been carried out. In all instances, the property must be registered at the Land Registry as owned by the applicant(s), at the date of application.
Acceptable capital raising purposes for remortgages are:-
- deposits or the full purchase consideration for residential investment property purchases
- undertaking repairs, minor improvements and refurbishments to residential investment properties.
Adverse Credit
CCJs : Not Acceptable
Defaults : Not Acceptable
Arrears : Not Acceptable
Bankrupt : Not Acceptable
Current IVA : Not Acceptable
Repossession : Not Acceptable
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