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Lending policy

View our full intermediary lending policy online

Lending policy

Proof of income documents

Our lending decisions are based upon a full affordability assessment whereby we will assess if the loan is affordable based on the applicant’s income, loan/credit card commitments and regular and essential household expenditure.

Please ensure you use our Online Affordability Calculator before submitting a Decision in Principle.

We require a Monthly Essential and Regular Expenditure Form for some customers who have low levels of outgoings in relation to their circumstances. An automated prompt on the Online Affordability Calculator will tell you when to fill this in for your client.

Providing the income and expenditure information input is accurate the calculator will provide you and your clients with an illustrative borrowing figure.

To help you complete this process more easily, forms can be e-mailed to expenditureform@virginmoney.com. If you are unable to email the form you can fax or post as usual.

If supporting documentation is not received in a timely manner, we reserve the right to cancel the original application including the product requested.

Additional case information

The table below provides details of the documents we will require to verify income. Please ensure that all paperwork, including fees, are in order and forms are signed and dated by submission. This will help us process the application quickly.

Income TypeIncome verification requirements
EmployedLast two monthly payslips and last P60, or last four weekly payslips and last P60.
Self EmployedLast two years' accounts or accountants certificate, or last two years' HM Revenue & Customs (HMRC) SA302 and corresponding Tax Year Overview.*
Pension IncomeLast annual pension statement (must be dated within the last 12 months), or last two monthly pension slips, or last two months' bank statements showing pension credits, or latest P60 or last HM Revenue & Customs (HMRC) SA302 and corresponding Tax Year Overview.*

*HRMC SA302 and corresponding Tax Year Overview are acceptable if printed by HMRC or from your customers online HMRC Account. The Tax Calculation document printed from the customer's online account must indicate the tax return is 100% complete for each year evidenced.

Where your client is unable to provide a copy of the last P60 one of the following substitutes can be used in its place:

  • Last payslip in previous tax year
  • Duplicate P60 from employer
  • Letter from HMRC to evidence last year's earnings
  • Statement of earnings from the employer to confirm all information which would be on a P60 (note this must be on company letterhead)

Customers employed for less than six months will be classed as in probation; your client must provide their last two years P60s to evidence a track record in a similar employment type.

Please note, for all residential loan applications the income being used to assess affordability must be paid in GBP / £Sterling. We will require evidence of this income.

Maximum Loan To Value
Valuation or purchase price whichever is lowerMaximum Home PurchaseRemortgage
£0 - £500k95%90%
£501k+80%80%

Your client may be able to borrow up to 95% LTV, subject to lending criteria.

The maximum Loan for Right to Buy, sitting tenants and remortgages is based on valuation.

The maximum LTV for Buy To Let loans is 75%.

The maximum LTV for loans on an interest only basis or the interest only element of a part and part mortgage is 70% on Residential and 75% on BTL.

There is a maximum loan size of £1 million.

There is no LTV restriction for existing mortgage customers applying for a pound for pound product transfer.

The maximum LTV for existing customers seeking additional borrowing is 85% (other restrictions may apply).

There is no maximum loan size on pound for pound product transfers.

The maximum LTV for new build houses is 85% on residential and 75% on BTL.

The maximum LTV for new build flats is 75% on residential and BTL.

Property

When a purchase falls through (residential or BTL) and the client wants to transfer their application to a new property the applicants details can be transferred to a new application.

Please use the “pre-populate” function within VMO or MTE to transfer existing application details from the DIP to a new case.

Input details of the new property within the form and select from currently available products. Give our Intermediary Relationship Support Team a call on 0345 600 1516* to let us know the new application number and we will transfer the original product, application fee and any unutilised valuation fees.

The existing application will then be cancelled.

If the original case has already been cancelled, we will allow the product and fees (where applicable) to be transferred up until six weeks after the date of cancellation.

When we receive the application it will be re-assessed and you will be advised of our documentary requirements in the normal way.

*Lines are open 8.30am-6.00pm, Monday to Friday excluding Bank Holidays. Calls to 03 numbers cost the same as calls to 01 or 02 numbers and they are included in inclusive minutes and discount schemes in the same way. Calls may be monitored and recorded.

Product switches

If you wish to request a product switch after submission, please contact us on 0345 600 1516*.

Please note that once you have submitted an application for a particular product, we will reserve funding for your client’s mortgage at the interest rate you have selected. After this point, you will only be allowed to change products if the subsequent choice comes from the same range of products.

Once a product range is replaced, your client will not be allowed to switch to a product from a later range.

Applications received after a product withdrawal date will not receive the former product rate unless the case has been received and then referred following Decision In Principle process for further underwriting consideration.

*Lines are open 8.30am-6.00pm, Monday to Friday excluding Bank Holidays. Calls to 03 numbers cost the same as calls to 01 or 02 numbers and they are included in inclusive minutes and discount schemes in the same way. Calls may be monitored and recorded.

Valuation fees

All residential purchase and all BTL applications are subject to a non-refundable £99 application fee, payable upfront, unless stated otherwise.

Purchase PriceValuation Report FeeHomebuyer's Fee
up to £60,000£112£270
£60,001 - £100,000£132£311
£100,001 - £150,000£163£352
£150,001 - £200,000£188£398
£200,001 - £250,000£214£444
£250,001 - £500,000£275£510
£500,001 - £750,000£331£561
£750,001 - £1,000,000£377£612
£1,000,001 - £1,500,000£510£817
£1,500,001 - £2,000,000£663£1,021
£2,000,001 - £2,500,000£817£1,225
£2,500,001 - £3,000,000£970£1,531
Over £3,000,000By NegotiationBy Negotiation

For residential remortgages on properties over £3m, Virgin Money will negotiate the cost of the valuation report with our suppliers. We will pay the first £970 of the valuation report fee and any amount above this must be paid by the client.

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

The Homebuyers Report fee is made up of two elements:

  1. the Basic Valuation Report fee (as above).
  2. the additional cost of the Homebuyer’s Report, on which VAT is charged to the applicant.

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 of Loan.

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.

We will no longer send you or your clients a copy of the basic valuation report, where no issues are identified.

For product transfer applications we will usually calculate the LTV using an index-linked valuation or AVM. In some instances we may need to carry out a full valuation, but we will always let you know in advance.

Credit Score

A credit check will be made on all applicants and the loan will be declined where an adverse credit history is revealed, for example if a County Court Judgement is registered. In addition, statistical techniques (credit scoring) will be used as part of the decision making process.

New Build policy

We define 'new build' as a property where construction is completed and/or the property is first occupied, in the last 24 calendar months.

Please note the maximum LTV available for new build properties is as follows and is based on the lower of valuation or purchase price:

All residential products:

New Build flats- maximum 75% LTV
New Build houses- valuation/purchase price up to and including £500,000 maximum LTV 85%
- valuation/purchase price over £500,000 - maximum LTV 80%

Help to Buy Equity Loans are available for first and next-time buyers with smaller deposits looking to purchase a new build home. For more information about the scheme, view the Help to Buy: equity loan scheme section of our A-Z Lending Policy.

All Buy To Let products:

  • New build flats and new build houses - maximum LTV is 75%

Clients buying a new build property may receive an incentive to purchase the property. All incentives must be declared at the time of application. For full details, please view the Incentives section of our A-Z Lending Policy.

Please note the Offer of Loan is valid for 26 weeks (six months) from the date of issue for new build. We will be able to provide an Offer extension for a further six months, subject to meeting our criteria. For full details please view the Offer to Loan extension section of our A-Z Lending Policy.

The product fee can be added to the loan, and is allowed to take the maximum LTV above that which is determined by Virgin Money's lending policy.

Purchases by way of sub-sale agreement are not usually acceptable. Please let us know if you need any further details.

We will lend up to a maximum of 20% of the units in any one block / development.

Product Transfers

All existing Virgin Money mortgage customers (residential and BTL) can request a pound for pound product transfer, at any LTV.

Additional borrowing may be available up to a maximum LTV of 85%, subject to full underwriting.

To obtain a redemption statement for your client please contact us on 0345 604 4898. Lines are open 8.30am-6.00pm, Monday to Friday excluding Bank Holidays. Calls to 03 numbers cost the same as calls to 01 or 02 numbers and they are included in inclusive minutes and discount schemes in the same way. Calls may be monitored and recorded.

Alternatively, get in touch with your dedicated Business Development Manager.

Buy-to-Let and Consumer Buy-to-Let criteria

We offer Buy-to-Let (BTL) and Consumer Buy-to-Let (CBTL) loans.

We consider both BTL and CBTL business to be a property that is occupied under a rental agreement and where there is no intention for the borrower or family member to reside. These loans are not regulated by the Financial Conduct Authority (FCA) under the Mortgage Conduct of Business (MCOB). If your client (s) or their family member(s) are to reside in the property at any time during the term of the loan it will be a FCA Regulated Mortgage Contract (RMC) under MCOB.

The following examples explain what we consider to be either BTL or CBTL.

BTL loans:

  • If a customer is purchasing a property with the sole intention of letting it out under a rental agreement, we would treat this as a BTL loan.
  • If a customer is remortgaging the property and meets either of the criteria below, we would treat this as a BTL loan:
    • They already own other BTL properties
    • They do not own any other BTL properties and since becoming the owner of the property (which includes inheritance for example) the customer or their family members have not lived in the property

CBTL loans:

  • If a customer is remortgaging the property and meets either of the criteria below, we would treat this as a CBTL loan:
    • They do not own other BTL properties and since becoming the owner of the 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)
    • They do not own other BTL properties and are looking to raise capital for themselves which amounts to 50% or more of the total loan amount (e.g. the property is unencumbered and the customer is raising capital to pay for a wedding or a car).

Policy criteria for BTL and CBTL loans

The below policy criteria, including affordability and rental assessments, applies to both, CBTL and BTL.

The following conditions must be met:

  • Evidence of a minimum personal combined gross income of £25,000 is required (excluding income received from BTL properties). We will accept non GBP / £Sterling income as part of this.
  • The rental income must cover 145% of the mortgage interest and this will be calculated in one of the following ways:
    • All products, with the exception of five year fixed rate, will be calculated on a notional rate of 5.50%.
    • Five year fixed rate products, will be calculated at the higher of either the Buy-to-Let Variable Rate (currently 4.74%) or the Product Rate.
  • The estimated monthly rental is calculated by the valuer on the basis of an unfurnished property, with a single Assured Shorthold Tenancy (AST) and the property being let as a single family dwelling.
  • Minimum age requirement of 21. For joint applications at least one borrower must be 21 or over and additional borrowers must be 18 or over
  • Maximum LTV for repayment and interest only loans is 75%
  • No minimum loan size and maximum loan size of £1million on any one property
  • Maximum portfolio loan £2million on a maximum of four properties with Virgin Money and a total of 11 mortgaged properties
  • Minimum property value £50,000
  • An assured shorthold tenancy (AST) or Scottish/Northern Ireland equivalent is set up within three months of completion and does not exceed 12 months if the rental income is less than £100,000. If the rental income exceeds £100,000 then a standard tenancy agreement must be in place
  • The property must be let on a single AST with a maximum of four tenants
  • We will only accept properties which are in a readily lettable condition at application

Virgin Money considers a property as ready to let if the following can be met:

  • The property is not in need of essential repairs and / or refurbishment
  • Its overall condition in respect of repair and fittings is to a standard which would be expected by the majority of potential tenants

Any property which does not meet the above requirements will not be acceptable to us on a BTL basis until further improvements have been made to bring the property up to the required minimum standard.

Restrictions:

  • Available to individuals only, not Limited Companies
  • Not available where customer intends to let the property back to the seller
  • We will lend up to a maximum of 20% of the units in any one block / development
  • We do not accept BTL applications for first time buyers
  • Applicants must be an owner occupier, and have had owner occupier status for at least six months on the date of decision (this applies to at least one applicant on joint applications). We may request evidence of this
  • Where a customer is remortgaging their main residence onto a BTL product a simultaneous completion must be made on a new residential property

For any queries please telephone 0345 602 8323. Lines are open 8.30am-6.00pm, Monday to Friday excluding Bank Holidays. Calls to 03 numbers cost the same as calls to 01 or 02 numbers and they are included in inclusive minutes and discount schemes in the same way. Calls may be monitored and recorded.

Additional case information - Buy To Let
  • We require information on the Landlords Buy to Let properties that are not mortgaged with Virgin Money if the total proposed Buy to Let borrowings with Virgin Money are in excess of £1 million. This can include, but is not limited to, details of property values, current rental income, and outstanding mortgage commitments.
  • Additional underwriter discretion will be used for exposure over £1.5million
Repayment methods

Full details of how the applicant intends to repay the mortgage must be given on the application form. Where this information is not provided or is insufficient, we will be unable to process the application until we receive satisfactory evidence and, as such the application will be delayed.

  • All residential products are available on a repayment, interest only or part and part basis. The maximum LTV for customers taking a residential mortgage on an interest only basis or the interest only element of a part and part mortgage is 70%.

We do not currently offer interest only mortgages to first time buyers.

The customer must have a credible repayment strategy in place to cover the balance of the loan at the end of the mortgage term. The repayment strategy must be in the name of the customer(s) and be from one of the following:

  • Endowment Plan
  • Managed Investment Plan
  • Personal Pension Plan
  • Sale of a mortgaged property (non main residence - maximum LTV 60%) cannot be used in conjunction with any other repayment strategy
  • Sale of other property (must cover 110% of the interest only element - maximum LTV 60%)
  • Managed share portfolio (must cover 110% of the interest only element at the time of application)

You will need to provide us with documented evidence of the repayment strategies.

Periodically, we will ask your client to provide us with information on the performance of the repayment strategy.

Capital raising is not permitted for debt consolidation on an interest only basis. It is the customer's responsibility to monitor the chosen repayment strategy to ensure it is on track to repay the mortgage balance at the end of the term.

  • All BTL products are available on a repayment, interest only or part and part basis. The maximum LTV for customers taking a BTL mortgage on an interest only basis or the interest only element of a part and part mortgage is 75%.
Lending into retirement

The maximum age limit for our applicant(s) is 75 years at the end of the mortgage term.

The maximum age to which Virgin Money will accept employed income is 67.

If the term of the mortgage extends beyond the oldest customers anticipated retirement date or age 67 and the customer is within 10 years of retirement, evidence of HM Revenue & Customs (HMRC) approved pension income must be obtained. Affordability will be assessed over the full term of the mortgage on the lower of the customer's current income or pension income.

If the customer is more than 10 years from their anticipated retirement date or age 67 and the term of the loan extends beyond this age, evidence they are paying into a Pension Plan must be provided.

The applicant's ability to afford the mortgage over the full term will be assessed.

For example:-

  1. A 40-year-old applicant anticipates they will retire at age 65 could take up to a maximum 25 year term without the need to supply evidence of pension arrangement(s).
  2. If the same 40 year old applicant requested a longer mortgage term, for example 33 years, then evidence the customer is paying into a pension plan would be required or the term capped to age 65.

Please note:-

  • As Virgin Money's minimum mortgage term is 7 years applicant(s) aged 68 years or over cannot proceed irrespective of pension arrangements.
  • Virgin Money will only consider pension arrangements registered by the HMRC for the purpose of providing retirement benefits.