Lending Criteria
The following is a summary of the principal lending policy, other rules may apply. You can also download our lending criteria as a pdf. Please see our Residential and Guarantor Lending Criteria for Residential Further Advances and Guarantor mortgages.
General Buy to Let criteria
Applies to all products, unless otherwise stated.
Term
Min: 5 years - Max: 35 years.
Portability
All our mortgages are portable so if your client simultaneously completes a mortgage for the same or greater amount then they can keep the interest rate they previously had for that portion of the new mortgage without having to pay the early repayment charge. This is subject to meeting the Company's current lending criteria at the time of obtaining the new mortgage.Property Substitution
Substituted properties will be underwritten based on the rates at the date of receipt and do not benefit from the original rates. The current LTV at the time of substitution must not be increased.Loan Purpose
Purchase or remortgage in England, Wales or mainland Scotland. Capital raising for business purposes is not accepted. Raising capital for other legal reasons including for deposit/purchase of a Buy to Let property will be considered.Capital repayment allowance
10% capital repayment per year without penalty. The capital repayment allowance cannot accrue year on year. The allowance is not available if the whole loan is being repaid or security released.Remortgages
Only acceptable after property has been owned for a minimum of 6 months.Further advances
May be considered after a minimum of six full consecutive monthly payments have been made. Further advances subject to revaluation in all instances. The minimum amount for further advances is £2,500 (unless otherwise stated).Purpose built flats and studio flats
The internal floor area must be no less than 30 square metres. Studio Flats must contain a separate bathroom and separate kitchen.Applicants
- Applications with more than two applicants are not accepted.
- Applications where a guarantor is to be a party to the mortgage are not accepted on Buy to Let mortgages.
- Applications where the mortgage introducer is also an applicant are not accepted.
Property development
Applications from property developers (a person who owns 25% or more of a business whose principal activity is property development) are not accepted for Buy to Let or owner occupied mortgages.Property Investment Clubs/Companies
Applications to purchase properties sourced via Property Investment Clubs/Companies are not accepted.Residency
- All applicants must be resident in the UK.
- Applicants with an immediate previous address abroad in the last three years are not accepted.
- Foreign nationals must be resident in the UK for at least three years prior to application and must have permanent right to reside.
- Foreign nationals must have a UK bank account.
New business application submission
All new business applications should be submitted via TMW Online. Selected exceptions apply. Please see TMW Online for details.Buy to Let Mortgages
Age
Min: 21 Max: 90 at loan maturity.Minimum loan
£25,001 (unless otherwise stated); minimum property value £50,000.Maximum overall loan per customer
- 80% LTV: £1,500,000
- 65% LTV: £5,000,000
Maximum LTV per property
(Unless otherside stated)
Loan Amount |
Maximum LTV |
£350,000 |
80% |
£1,000,000 |
65% |
£1,500,000 |
50% |
Should a multiple property landlord wish to purchase or remortgage a single property to The Mortgage Works, the evidence of portfolio ownership may be required (e.g. completion statement combined with a current rental agreement).
Rental income
Houses in Multiple Occupation* |
150% |
All other products |
125% |
- Fixed rates up to and including 75% LTV: Based on product pay rate or 4.99%, whichever is higher.
- Fixed rates above 75% LTV: Based on product pay rate or 5.99%, whichever is higher.
- Tracker rates: Based on product pay rate +0.5% or 4.99%, whichever is higher.
Conventional income multiples are not used. The valuer must confirm that actual gross monthly rent (based upon unfurnished figure) conforms to the rental income ratio using a monthly interest only calculation.
*Assessed on multi-tenanted basis.
Multiple self-contained units under a single property title
Not accepted.
TMW multi property portfolio proposition
TMW's multi property portfolio proposition (for example, where rental income and LTV is averaged across the portfolio) is not available for new customers. Existing multi property portfolio customers may continue to operate their accounts on this basis, however no additional borrowing or increase in LTV will be permitted.
Houses in Multiple Occupation (HMO)
Properties let on a HMO basis are classified as:
- The property occupied by 5 or more people, comprising 3 or more households (being unrelated persons)
- A property subject to Houses in Multiple Occupation licensing
- A property containing no more than four habitable storeys and no more than one kitchen
- Properties consisting of more than one self-contained unit under a single title are not acceptable
- Rental cover will be assessed on a multi-tenanted basis up to 65% LTV
- Experienced landlords only
- Let to Buy, Light Refurbishment, and Limited Company applications are not accepted
- All properties will be subject to an Assured Shorthold Tenancy agreement of a minimum of 6 months, maximum of 12 months
- Single and multiple tenancy agreements accepted (multiple tenancy agreements - maximum 4 tenants)
- A Specialist Security valuation will be required
Loan purpose
Purchase or remortgage in England, Wales and mainland Scotland.
First time landlords
Buy to Let new business products are available for first time landlords (for purchase only), classified as applicants who have not owned and let a buy to let property for the last six months.
Subject to:
- Max 75% LTV (customers purchasing over 65% LTV must choose from the First Time Landlord range).
- First time landlords must be owner occupiers (with or without a mortgage)
- The applicant(s) must have owned their residential property for at least 6 months at the time of application
- Loan purpose: to purchase a new buy to let property
Let to Buy
First time landlords, classified as applicants who have not owned and let a buy to let property for the last six months, remortgaging their existing residential property as a buy to let must choose from the Let to Buy product range.
Subject to:
- Max 75% LTV.
- The applicant(s) must have owned their residential property for at least 6 months (with or without a mortgage) at the time of application.
- Loan purpose: to remortgage their residential property into a buy to let property.
- Remortgage applications will only be accepted where there is a simultaneous onward purchase of a new residential property, which must be confirmed by the acting solicitor.
Light Refurbishment
Classified as a Buy to Let rental property which will benefit from minor improvements to be carried out within 3 months of completion and prior to letting, subject to selecting a light refurbishment product.
- Initial Advance: Up to 70% of the property value or purchase price (whichever is lower) will be advanced. Once works are completed 70% of the after works value to a maximum of £25,000 can be released subject to successful re-inspection.
- Retention: The amount required for refurbishment will be held, to a maximum of £25,000 which can be released on completion of the works, confirmed by a re-inspection of the property, payable by the customer.
- Minimum Retention: £2,000
- Maximum Retention: £25,000
- Valuation: Will be completed in the first instance and value will be assessed on current and after works basis.
- Re-inspection: Once the work has been completed as required, a re-inspection costing £100 (payable by the customer), will be needed before retention monies can be released.
- Rental cover will be based on rental assessment after works.
- First time landlords purchasing accepted up to 65% LTV
- TMW reserves the right to withold the retention amount if the works have not been carried out within 3 months.
Limited companies
TMW's Limited Company accounts are not available to new customers. No additional borrowing or increase in LTV will be permitted for existing accounts.
New build Buy to Let applications
The Mortgage Works will accept applications for new build properties (new build flats and houses are defined as properties built or sold within the last 12 months). Applications for new build flats accepted up to a maximum of 65% loan to value.
Property concentration exposure limits
The Mortgage Works will consider its overall exposure by applicant, geographical area and development when assessing applications. The maximum number of securities that can be considered per development is:
- 1-3 units: 1 unit
- 4-50 units: 25%, rounded down to the nearest unit
- 51-80 units: 12 units
- More than 80 units: 15%, rounded down to the nearest unit
These exposure limits are per applicant and include securities mortgaged to other lenders.
Sale and rent back
It is not permitted for the vendor to remain as a tenant in the property or to retain an interest in the property.
References checklist
Buy to Let
We do not require verification of income but as part of our underwriting process we may ask for it.
- Proof of income for employed and Self employed - not required.
- Proof of Mortgage payments - not required.
- Proof of Rent payments - required.
- Bank Statements - not required.
Proof of source of deposit (examples)
Gift from a UK donor
Signed letter - including address - from benefactor stating monies are non-refundable. Further evidence may be requested. Insolvency Act Indemnity Insurance may be required.
Gift from a non-UK donor
If the applicant has received all or part of the deposit as a non-repayable gift from a donor outside of the UK then a letter of confirmation is required from the donor together with proof of the donor's source of funds.
If funds have been in the donor's account for less than three months further information is required and must be obtained. The letter of confirmation must show the donor's address and must be signed. The Mortgage Works may ask for further information on the source of the donor's funds if deemed necessary after reviewing the documentation held in conjunction with the mortgage application and product requested.
Savings
Copy of bank statement, e.g. bank/building society savings account, ISA (for non-UK residents BTL applicants where funds have been in the account for a period of less than six months we require proof of their origination).
Valuation fees
Purchase Price or Valuation |
Standard Valuation Fee † |
Including Homebuyers Report † |
Up to £100,000 |
£365 |
£450 |
£100,001 - £150,000 |
£390 |
£535 |
£150,001 - £200,000 |
£430 |
£620 |
£200,001 - £300,000 |
£490 |
£720 |
£300,001 - £400,000 |
£555 |
£820 |
£400,001 - £500,000 |
£615 |
£930 |
£500,001 - £600,000 |
£695 |
£975 |
£600,001 - £700,000 |
£755 |
£1,035 |
£700,001 - £800,000 |
£795 |
£1,115 |
£800,001 - £900,000 |
£865 |
£1,200 |
£900,001 - £1,000,000 |
£910 |
£1,275 |
£1,000,001 - £1,250,000 |
£1,125 |
By Arrangement |
£1,250,001 - £1,500,000 |
£1,275 |
By Arrangement |
£1,500,001 - £1,750,000 |
£1,475 |
By Arrangement |
£1,750,001 - £2,000,000 |
£1,675 |
By Arrangement |
Over £2,000,000 |
By Arrangement |
|
† The total amount payable includes a non-refundable £150 application fee. For existing customers using our Multi Property Portfolio Buy to Let proposition, if more than one property is being financed simultaneously, the £150 is paid only once. For example the second valuation fee is £215 for property values up to £100,000.
Product switches
Pre-completion product switches require our underwriters' prior approval. Switch fees of £350 may be charged.
Valuation policy
Where a valuation for mortgage purposes is subcontracted to a panel of chartered surveyors, we make the same charge for the mortgage valuation or Homebuyers survey and valuation in accordance with the above table as we do when using a staff valuer. The difference between the table charge, excluding application fee, and that which the company pays the panel valuer covers The Mortgage Works' administration costs.
- Re-valuation fees for further advances - 50% of the valuation fee (excluding application fee), rounded down to the nearest pound.
- Further advance applications for Houses in Multiple Occupation require payment of the full specialist security valuation fee (including non-refundable application fee)
- Re-inspection fee - £100.
- Transcribe fee - £210 (includes a non-refundable £150 application fee).
Transcribed valuations
Transcribed valuations are not normally acceptable, except on purchase applications in Scotland where no fee is payable and the following conditions will apply:
- The valuation must have taken place prior to submitting the application.
- The valuation must have taken place in the last 90 days.
- For Buy to Let valuations, the report needs to include a rental assessment.
- For Scottish Light Refurbishment applications, transcribed valuations will not be accepted - see below.
Scotland
A restricted panel of valuers are acceptable for purchases of property in mainland Scotland; please contact us for details.
- For Scottish Light Refurbishment applications, transcribed valuations will not be accepted. Scottish applicants will require a full valuation to be carried out by TMW at the outset. The cost of the valuation will be payable by the customer and will be based on the current TMW standard valuation fee scale.
- The valuer providing the transcription must be the individual who prepared the original Home Report or inspected the New property.
- The Home Report must have a pre-exisiting "generic mortgage panel" report within it.
- When the valuation figure is the result of a 'refresh' (update) of the original Home Report, it must be based on a further internal inspection that has taken place in the last 90 days.
House in Multiple Occupation
Houses in Multiple Occupation require a Specialist Security valuation.
Other information
The valuation report and figures therein will not be challenged. In the case of BTL applications, we will apply the lower of passing rent or estimated rental value as given by the valuer.
Estimated rental value will be based on market rent for the property in the locality allowing for its most appropriate use.
If the valuation has been carried out and the property has been found to be of unsuitable security or the application does not proceed, the valuation fee will not be refunded.
Specialist Security valuation fees
(Including non-refundable £150 application fee)
Purchase Price or Valuation |
Standard Valuation Fee |
Up to £200,000 |
£585 |
£200,001 - £300,000 |
£820 |
£300,001 - £400,000 |
£940 |
£400,001 - £500,000 |
£1,000 |
£500,001 - £600,000 |
£1,175 |
£600,001 - £700,000 |
£1,275 |
£700,001 - £800,000 |
£1,400 |
£800,001 - £900,000 |
£1,500 |
£900,001 - £1,000,000 |
£1,645 |
£1,000,001 - £1,250,000 |
£1,995 |
£1,250,001 - £1,500,000 |
£2,250 |
Over £1,500,000 |
By Arrangement |
Solicitors
We will instruct our solicitors/conveyancers to oversee the transaction if the applicant is purchasing the property from their own limited company, a fee of £299 plus VAT and disbursements is payable - fee applies per property.
Our solicitors'/conveyancers' fees will be payable by the applicant(s).
Solicitors/conveyancers with less than two partners will not be eligible to process applications for The Mortgage Works unless they are on our approved panel.
A conveyancing fee of £50 will be charged where a client chooses to use a sole practitioner.
Additional product features
The below features are only available for single property applications on selected products, subject to availability.
Products offering free standard valuations
- Free standard valuations are available to a maximum property valuation of £500k.
- Available for properties in England, Wales and mainland Scotland (unless otherwise stated, please refer to product guide for further details).
Products offering cashback
Where a product offers a cashback benefit, the borrower will receive this when the mortgage starts. The cashback sum will be sent to the borrower's conveyancer with the funds for the mortgage loan.
Products offering free standard legal fees
- Free standard legal fees are available to a maximum property value of £500k
- Available for properties in England, Wales and mainland Scotland (unless otherwise stated)
- Applicable on selected remortgage and purchase products (please refer to product guide)
We will pay the standard legal fees for your client's purchase or remortgage (as appropriate) of the property, except for the costs of any searches and reports or any payments to third parties such as the Land Registry or HMRC provided:
- Your client uses our nominated conveyancers to act for them
- The legal title of the property is already registered at the Land Registry
- No existing secured loans will remain on the property after our mortgage starts
- On a remortgage, no parties are being added to or removed from the property's legal title
- The legal title of the property is freehold or leasehold
For a full list of non-standard fees your client may have to pay please download our additional charges guide and ensure a copy of this guide is provided to your client. The acting conveyancer will send your client a full list of the non-standard fees in the initial instruction letter.
If your client decides not to use the conveyancer selected by us and/or takes independent legal advice, this will not be covered under our 'free legal fees' scheme. In this instance an alternative product may need to be selected, which could incur additional fees.
