Lending policy

A-Z lending policy

The purpose of this search facility is to provide guidance on Virgin Money's Lending Criteria. You can either browse alphabetically or enter a keyword you would like to search in the panel on the left hand side.

Showing results for F-H

Family Purchase

Available to first time buyers and next time buyers providing a bankruptcy search and declaration of solvency on the seller is completed, or defective indemnity insurance is arranged by the acting solicitor against the full market value of the property.

Where the property is being sold at a discounted price Virgin Money will lend up to the lower of:

• 100% of that discounted price, or
• The maximum LTV permitted on valuation

Additional lending up to maximum LTV limits is allowed providing the extra funds are solely for home improvements. If lending exceeds the discounted price a retention may be held.

We will not accept an application where the vendor continues to live in the property being sold.

Fees

If a fee is required and we don’t have payment details or are unable to collect them the application will be cancelled after 14 days. We will contact you to let you know if there are any issues collecting these.

Valuation Fees

Valuation/Purchase Price	Basic Valuation Report fee
Up to £60,000	£112
£60,001 - £100,000	£132
£100,001 - £150,000	£163
£150,001 - £200,000	£188
£200,001 - £250,000	£214
£250,001 - £500,000	£275
£500,001 - £750,000	£331
£750,001 - £1,000,000	£377
£1,000,001 - £1,500,000	£510
£1,500,001 - £2,000,000	£663
£2,000,001 - £2,500,000	£817
£2,500, 001 - £3,000,000	£970
Over £3,000,000	By Negotiation

The Basic Valuation Report fee includes the VAT charged to Virgin Money by the valuer.

Please note that the Valuation Fee(s) above are based on the actual property valuation.

If the instructed valuer values the property at a figure which differs from the purchase price/estimated value stated on your mortgage application form, the fee payable may change in accordance with the table above.

In the event the property is valued at a figure higher than that stated on the mortgage application form, the difference between the Valuation Fee payable and the actual amount paid prior to the valuation will be payable prior to the issue of an Offer.

In the event the property is valued at a figure lower than the figure stated on the mortgage application form, the difference will be refunded to you.

Please note, a mortgage exit fee of £50 will be payable on redemption of your client's mortgage to cover the administrative cost incurred by Virgin Money. This fee will be applied if the mortgages is redeemed or ported before the full mortgage term ends.

Your client's solicitor, licensed or qualified conveyancer may make an additional charge for their work in relation to redemption of the mortgage and discharge of the security.

For product transfer applications we may not carry out a physical valuation on all cases, but if we do we will always let you know in advance.

Financial Commitments

All financial commitments as well as regular and essential household expenditure will be taken into account when assessing the customer's affordability. In order to obtain an accurate lending decision for the customer please provide details of the following:

• Unsecured loans
• Hire purchase/contract hire
• Revolving debt (credit cards, store cards, mail order, overdrafts)
• Second charge loans
• Other mortgages (BTL's need not be included provided the rent covers the mortgage payment by 145%)
• Help to Buy Equity Loans
• Child support/maintenance

First Time Buyers

We define First Time Buyers (or FTBs) as customers who have never previously held a mortgage. For a joint FTB application, neither customer will have been party to a mortgage.

Flats & Maisonettes

Flats in buildings with 4 storeys or fewer are acceptable to 95% LTV.

Flats in buildings with 5-10 storeys are acceptable to 85% LTV (95% for Shared Ownership).

Flats in buildings with more than 10 storeys are acceptable to 80% LTV (95% for Shared Ownership).

Flats in buildings with over 5 storeys must be serviced by a lift. The number of storeys includes all floors and if there are multiple blocks in a development which share an entrance we will use the storey height of the highest block.

Ex local authority, housing association or MOD flats are acceptable to 85% LTV (but not for Shared Ownership). They must not be in a building of over 7 storeys. Deck access / balcony access is only acceptable if built for the private sector.

Flats over or adjacent to commercial premises are acceptable subject to valuer assessment including that the commercial premises doesn’t detriment demand or enjoyment of the property. The flat’s entrance must not be via the commercial premises and flats immediately above or adjacent to food, drink or dry cleaners will usually be unacceptable.

Flats must be at least 30m² and studio flats are not acceptable.

New build flats are acceptable to 80% LTV residential (95% for Shared Ownership) / 75% BTL. Converted flats are defined as new build until the later of 2 years after conversion or the date of first occupation.

Flats must be leasehold (or in Scotland, heritable or leasehold). Share of freehold is acceptable. Freehold flats are only acceptable for a Tyneside flat where there are reciprocating lease/ freehold arrangements, with our security being the lease of the subject flat and the freehold of the other flat.

We treat maisonettes the same as flats.

Flats (Freehold)

Freehold flats are only acceptable where there are reciprocating lease/freehold arrangements (such as Tyneside Flats)

Flooding

Where a property has previously been affected by flooding or is situated on a flood plain, the property is acceptable to Virgin Money, subject to a satisfactory valuation report and positive valuer comment.

The applicant must be able to obtain full buildings insurance including all perils, subject to a maximum flooding excess of £1,000.

If full buildings insurance including all perils is not available as described the property is not acceptable and will be declined.

Forces Help to Buy

Forces Help to Buy is a scheme open to serving members of the armed forces allowing them to borrow up to 50% of their annual salary up to £25,000 interest free. Funds can be used towards a deposit and fees for a residential purchase and are repaid in equal instalments over a 10 year period, deducted from salary with a small insurance premium.

We accept the Forces HTB loan as a residential mortgage deposit.

When applying, please select ‘Other’ as the source of deposit, and use the box that appears to tell us it’s ‘Forces HTB’ It’s important to include the Forces HTB loan and insurance payments as expenditure so we know how much the customer will be paying. In the ‘Financial Details’ section please declare the loan under ‘Existing Loan Details’ as an ‘Unsecured’ commitment and include the insurance cost under ‘Monthly Outgoings’ as ‘Insurance & Investments’.

We don’t need the customer’s personal information note from the MoD which confirms their loan. We allow Forces HTB for Shared Ownership too, and it’ll count towards the minimum 5% personal contribution we need for a Shared Ownership deposit.”

Foreign Currency

Residential Applications

We do not offer foreign currency loans.

For all residential loan applications the income being used to assess affordability must be paid in GBP / £Sterling and we will require evidence of this income.

Where your client is paid in both Sterling and a foreign currency, we will only consider their Sterling income for the purposes of affordability.

Buy-to-Let Applications (including Consumer Buy-to-Let)

If a customer is receiving rental income from their buy-to-let property in a currency other than GBP £Sterling, this will not be acceptable income for assessing affordability.

Repayment Strategies for Interest Only loans

For both residential and buy-to-let loans, we will not accept repayment strategies denominated in a foreign currency to support an interest only loan.

Foreign Nationals

Virgin Money does not differentiate between British and Irish Nationals in our lending policy.

Non-UK/Irish Nationals:

The customer(s) must have unrestricted rights to live and work in the UK. Evidence confirming their rights of indefinite leave to remain in the UK or settled or pre-settled status under the Government’s EU Settlement Scheme must be provided. In all cases Virgin Money requires a minimum three years’ UK address history.

Requirements:

• Passport or National Identity Card
• Two items confirming residence in the UK
• Evidence of 3 Years consecutive UK addresses
• A United Kingdom Residence Permit; or
• Share code so we can check the settled or pre-settled status of EEA/Swiss citizens

Foster Carers

Income from foster caring is acceptable and is subject to our usual self employed policy.

Any individuals under foster care should be included as dependants within the application.

Gifted Deposits

Where the deposit is being gifted, the person or persons, gifting the deposit need to complete our Gifted Deposit Form (below). This confirms that the deposit monies are a gift and the person does not expect to be repaid these monies either whilst the borrower(s) owns the property or upon its sale.

The below form should be filled out and returned to Virgin Money;

• Gifted deposit template (250KB) PDF

Greener Mortgages

Our Greener Mortgages give customers access to a range of new-build products that are priced more competitively than their equivalent Core products, rewarding customers for purchasing an energy efficient home.

To qualify, customers must be purchasing a new-build residential home with a certified or predicted energy rating of A or B. This will be evidenced by an Energy Performance Certificate (EPC), a Predicted Energy Assessment (PEA) or a Standard Assessment Procedure (SAP) calculation.

These can be obtained from the Builder (site office or sales manager) or government register and must be submitted to us as part of the mortgage application process, along with any other supporting documentation. Please also see our New Build lending criteria.

Guarantor Mortgages

We don’t offer guarantor mortgages.

Holiday Home Purchase

The following conditions must be satisfied where the property being purchased is intended to be a holiday home:

• Maximum LTV 75%
• Timeshares will not be considered
• The customer must be able to afford all credit commitments including any mortgages