UK Buy-To-Let mortgage: Broker and Intermediaries

Key criteria

The application can be emailed or couriered to our office. Please note, as the application is for non-UK residents the documentation requirements may be more extensive than for similar applications for UK residents to other banks. Any incomplete applications WILL BE returned and not reviewed as the underwriting process in such cases cannot be undertaken. Please see packaging guidelines for full information.

Client

1) Each applicant must be a passport holder and have their citizenship noted in the nationality section of their passport for a country not listed in Skipton International's Restricted Country List. 

2) Each applicant must remain resident overseas and not planning to move to the UK in the near future or reside in the property in the future.

3) The client cannot be living, working or a national in a country on our Restricted List. Please note Skipton lends to Australians living outside of Australia.

4) The client is not a Chinese national residing in mainland China. This does not apply to residents of Hong Kong, Chinese nationals living outside mainland China or Expatriates working in mainland China.

5) The client needs to have a UK bank or building society account from which direct debits can be arranged to pay their mortgage.  This must be opened prior to application.  If they are not using a “major UK Bank” or an easily recognisable Bank or Building Society, they will need to provide an email confirmation from the Bank in question. They must confirm they can allow Direct Debits to be claimed from the account.

6) One month bank statement. This must show their salary / pension being credited and mortgages/ rent being debited (if applicable). The statements must detail account holder’s name(s), account number, narrative, debits, credits and running balances. See packaging guidelines for a full list of required documents.

7) The client can never have been declared bankrupt, insolvent or equivalent and no action should be pending. They should never have entered into any arrangement with creditors or party to a voluntary arrangement. Should never had a property repossessed by a lender or entered into an arrangement for mortgage arrears. They should also not have an unsatisfied court order or have any such actions pending.  If a court order has been satisfied, we will look at this on a case by case basis.

Portfolio Landlord

Once an applicant owns four or more mortgaged Buy-To-Let properties, they are classified as a "Portfolio Landlord".  At this point, Skipton International applies enhanced affordability checks.

If your client is a Portfolio Landlord as defined above, Skipton requires any properties within the portfolio, that are mortgaged via other lenders, to meet Skipton International's BTL affordability criteria.  This means that rental income must provide a minimum of 125% interest cover, when interest is calculated on total borrowings at a rate of 6.49%.  This calculation is applied to all BTL properties mortgages outside Skipton International on a collective basis.  In the event of a rental shortfall the application will be declined.  In addition:

• Skipton International can offer a maximum of 5 BTL properties to any one client.
• Skipton International is unable to accept applications from clients who have more than 5 BTL properties.
• Skipton International will allow a maximum of 3 BTL properties, within the whole portfolio, to be held within any 1 post code district, e.g. SW1.  In the event of more being held, the application will be declined.

The above is not exhaustive just a guide.

Income

Clients can be employed, self employed or pensioners.  Income must be from one source only. Earned income with the exception of pension income cannot be subject to UK income tax.

i)  Is your sole basic earned income (not including commission, overtime or bonuses) or pension income over £40,000 or the equivalent of £50,000 p.a. if paid in local currency?

ii) For a joint application where neither party is earning £50,000 p.a sterling equivalent, is the combined basic earnings of both parties £80,000 p.a sterling equivalent?

Certain guaranteed allowances may contribute towards this figure. Any probationary period must be passed prior to applying. Earned income with the exception of pension income cannot be subject to UK income tax.

iii) If self-employed, can you provide evidence that either party's annual income is in excess of £60,000 p.a. sterling/ or equivalent of £75,000 p.a. if earned in local currency. Earned income with the exception of pension income cannot be subject to UK income tax.

iv) Self employed applicants can appoint a local fully qualified accountant working in an accountancy firm with a minimum of two partners. The firm and accountant must be:
- Clearly identifiable
- Suitably qualified (local equivalent of ACA, FCA, ACCA, FCCA, IPFA or ICAS)

OR

Alternatively, self employed applicants can provide the last years final income tax assessment (where written in English).

 https://www.skiptoninternational.com/sites/default/files/uploaded/forms/Accountants%20Certificate%20UK.xlsx

 v) If pensioners, a minimum income of £40,000 per annum or the equivalent of £50,000 per annum if paid in local currency.  This can be subject to UK income tax if the clients have retired abroad and can be from more than one pension provider.

Mortgage

1) We support mortgages on properties in England, Wales, Scottish mainland and the Channel Islands. Please note Skipton International does not lend on properties located in Northern Ireland, Isle of Man or the islands of Scotland

2) Minimum mortgage of £100,000 and maximum exposure per client, together with connected persons, of £5m.

3) The maximum age of applicants at the start of the mortgage is 69 and maximum age at expiry of mortgage is 84. 

4) The maximum mortgage term is 35 years subject to point 3.

Property

1) The property must be for Buy-To-Let purposes and neither the borrower nor their family can live in the property during the original 3 or 5 year Tracker or Fixed rate product period.

2) The property cannot be on our unacceptable properties list.

3) Consumer buy to lets are acceptable.

4) The property must be let on a suitable Assured Shorthold Tenancy agreement (or a Private Residential Tenancy agreement if in Scotland) and not be used as a holiday let or HMO.  Please refer to our property letting requirements documents for further information. 

Property Letting Requirements (England and Wales)
Property Letting Requirements (Scotland)

5) The property needs to have been owned by the existing owner for a minimum of 6 months (this applies to purchase/remortgage/equity release or further borrowing). Inherited property is not subject to this 6 months as long as Probate is complete and a letter from the solicitor dealing with the estate confirms that the customer has inherited the property.

• Earned income with the exception of pension income cannot be subject to UK income tax

Rental calculations

To enable your client to take advantage of the 110% stress test at 5.99% for the 3 year base rate tracker or 110% at payrate on the 5 year fixed, they need to meet the following criteria.

• Loan amount to be a minimum size of £250,000
• Clients basic income (or main earner if joint application) to be a minimum of £100,000 GBP equivalent or higher.
• Debt income ratio not to exceed 20%.
• One loan at 110% per client.  Any other mortgages to be stressed at the standard 125%.

Restricted countries

Skipton will not accept applications from clients resident in or citizens of the following countries: 

Please note Skipton lends to Australians living outside of Australia. We do not lend to Chinese nationals residing in mainland China.

• Afghanistan
• Albania
• Algeria
• American Samoa
• Angola
• Argentina
• Australia
• Azerbaijan
• Bangladesh
• Barbados
• Belarus
• Belize
• Bolivia
• Bosnia and Herzegovina
• Botswana
• Burkina Faso
• Burma
• Burundi
• Cambodia
• Cameroon
• Cape Verde
• Cayman Islands
• Central African Republic
• Comoro Islands
• Congo Dem Rep of
• Cuba
• Djibouti
• Dominican Republic
• Ecuador
• Egypt
• El Salvador
• Eritrea
• Ethiopia
• Ghana
• Guam
• Guatemala
• Guinea
• Guinea-Bissau
• Haiti
• Honduras
• Iran
• Iraq
• Ivory Coast
• Kazakhstan
• Kenya
• Kyrgyzstan
• Laos
• Lebanon
• Lesotho
• Liberia
• Libya
• Madagascar
• Malawi
• Maldives
• Mali
• Marshall Islands
• Mauritania
• Mexico
• Moldova
• Morocco
• Mozambique
• Myanmar
• Namibia
• Nepal
• Nicaragua
• Niger
• Nigeria
• North Korea
• Pakistan
• Panama
• Papua New Guinea
• Paraguay
• Russia
• Rwanda
• Senegal
• Serbia
• Sierra Leone
• Somalia
• South Sudan
• Sri Lanka
• Sudan
• Swaziland
• Syria
• Tajikistan
• Tanzania
• Togo
• Trinidad and Tobago
• Tunisia
• Turkmenistan
• Uganda
• Ukraine
• Uzbekistan
• Venezuela
• Yemen
• Zambia
• Zimbabwe

Unacceptable properties

Properties/developments against which Skipton will not lend

This list is not exhaustive and will be updated from time to time: Developments which Skipton will not lend

If you have a new build property and/or any that are not on this list, please refer to the Sales team as normal on 0044 (0)1481 734000 or mortgagesales@skiptoninternational.com prior to applying.  Also, please note that the developments may have various postcodes and not just those provided.

Energy Performance Certificate (EPC) 

Skipton International will require all landlords of UK rental properties to have a minimum Energy Performance Rating of A to C or a “D” rating only if it can be upgraded to an A to C rating.

Skipton International will require applicants to supply a copy of a current Energy Performance Certificate demonstrating its rating or potential rating.

Skipton International reserves the right to request provision of Energy Performance Certificates at any point during the life of your mortgage.

England and Wales

To check if your property meets the required standards, simply click on the following link, enter the postcode and download the Energy Performance Certificate in PDF format.

For further information and guidance, please visit the UK Government web site.

Scotland

To check if your property meets the required standards, simply click on the following link, enter the postcode and download the Energy Performance Certificate in PDF format.

For further information and guidance, please visit the following web site; https://www.gov.scot/

Ground rent criteria

Ground rent

Prior to submitting your application please refer to the “Supporting Documentation Check List section called “Ground Rent” to ensure that your ground rent is within criteria.

Ground rent New Builds

• If you are purchasing or remortgaging a New build property please provide the following details;

1. Ground rent
2. Renewal basis (i.e. by RPI)
3. Renewal term (how often the ground rent is reviewed/increased)

Ground rent Previously owned property

• If you are purchasing or remortgaging a Previously owned property, please provide the following details;

1. Ground rent
2. Renewal basis (i.e. by RPI)
3. Renewal term (how often the ground rent is reviewed/increased)
   

Estate Rent charges

• If your property is subject to “Estate Rent charges”, please contact ours sales team “prior” to submitting an application as prior agreement is required.

Construction

1. Properties that will not be complete (ready for tenant occupation) within 6 months of applying to Skipton.
2. Non standard construction or conversions will be assessed on a case by case basis.
3. LPS (large panel systems) and PRC (precast reinforced concrete) properties. However, some modern building construction types will be acceptable.
4. Properties less than 10 years old without a building warranty certificate.  A list of acceptable providers is available on request.  Architects' certificates are only acceptable on developments with less than 15 units.
5. Scottish properties which have any form of cladding to the exterior.

Licensed Houses of Multiple Occupancy

Flats

1. Flats over 5 floors with no access to a lift. No restriction on number of floors if not ex LA.
2. Ex-local Authority flats exceeding 5 floors or exceeding 48 units in the block.
3. Leasehold properties with less than 85 years to run at the point of application.
4. Properties directly above commercial premises need to be agreed prior to an application being submitted.
5. Post Grenfell Towers, we need confirmation that any cladding/external insulation meets current fire regulations.  We will require evidence of this prior to a valuation being instructed.  If not, the valuer may return a nil value on the property. Confirmation can be in the form of a report by either a “Fire Safety officer” or a “Structural Engineer” with the appropriate fire prevention experience. This would need to confirm that the property has been inspected post 14 June 2017 and considered to meet current requirements.
6. Flats with/ without a leasehold and where the client owns the full freehold (not just a share).
7. Freehold and flying freehold (or part thereof) flats in England or Wales.  
8. Scottish properties which have any form of cladding to the exterior.
9. Studio apartments with a value less than £350,000 and square meterage of less than 35sqm.

Other

1. Properties less than 10 years old without a building warranty certificate.  A list of acceptable providers is available on request.  Architects' certificates are only acceptable on developments with less than 15 units.
2. Houses that are leasehold will be assessed on a case by case basis to ensure there are no onerous ground rent conditions.
3. Grade I or II* Listed Buildings in England and Wales or Grade A Listed Buildings in Scotland. Other categories of Listed Building are acceptable subject to valuer comment and there being no onerous restrictions in the title deeds.
4. Any properties affected by invasive plant species e.g. Knotweed.
5. Holiday lets.
6. Thatched properties.
7. Leasehold properties with less than 85 years to run at the point of application.
8. Properties that comprise more than one independent unit of accommodation (annexes, wings and duplex properties etc.).
9. Properties being purchased at auction.
10. Office block conversions

Packaging guidelines

As applicants are non-UK resident please note the documentation requirements may possibly be more extensive than for UK resident mortgage applications with other banks. Therefore please read these guidelines carefully. Applications will NOT be underwritten unless a full pack is received and incomplete applications will be returned to sender as underwriting cannot be completed until all packaging requirements have been satisfied. 

For House Purchases you must instruct solicitors to act on your behalf. You are of course at liberty to instruct any solicitor of your choice, however, Skipton uses Conveyancing Direct for properties in England and Wales and Aberdein Considine for properties in Scotland. Both firms do offer Skipton clients a competitive rate and whilst your and Skipton’s interests are represented separately it can often be more efficient and timely to use a common firm.

Conveyancing Direct may be contacted via Simonetta Filippi, on +44 (0)1424 464900 or by email at sales@cdpll.co.uk. Aberdein Considine Solicitors may be contacted via their Senior Solicitor, Natasha Day, on +44 (0) 1224 337 467, or by email at skiptoninternational@acandco.com

Original Application Form and Direct Debit Mandate (must be signed in accordance with passport and signatures provided).  All non-English documentation must be translated by a reputable translation company.

For each applicant please ensure that you provide the following supporting documentation with the application. The pack can be sent via email or posted/couriered to Skipton International Ltd’   If a panel broker, please contact the sales team for guidance on submitting applications.

UK Buy-To-Let application pack

Application Form and Direct Debit Mandate (must be signed in accordance with passport) and attach the following supporting documentation:

1. Photo identification

Certified copy of passport (our identification verification form, seen in the application pack, should be used by the certifier). If not using the form, the certification needs to be include the wording “Having seen the individual and identification document at the same time I certify this is a true copy and that the photograph is a reasonable likeness”. Please ensure that the signature page of the passport is also provided.

Copies must be certified by a professional person. For a list of Acceptable Certifiers please visit https://www.skiptoninternational.com/sites/default/files/uploaded/forms/VerificationofIdentityHelpSheet.pdf

2. Address verification

Please provide one of the following as proof of current address (not required for previous addresses):

• Original letter from employer – this must confirm the current residential address and any correspondence address (including PO Box number)
• Original / certified copy of a Utility bill – no longer than 3 months old (excluding mobile phone bill or car insurance)
• Original / certified copy of a Bank Statement – no longer than 3 months old
• If a PO Box address is required, proof must be included as above (mandatory for clients in the UAE and Caribbean)

If the client wishes to use a correspondence address (that is not their residential address) you will need to supply the following:-

• Certified copy of resident’s passport(s). (Our Identification verification form, seen in the application pack, should be used by the certifier).
• Certified copy of a Utility bill of the occupier– no longer than 3 months old (excluding mobile phone bill or car insurance)

Copies must be certified by a professional person. For a list of acceptable certifiers please visit www.skiptoninternational.com/sites/default/files/forms/VerificationofIdentityHelpSheet.pdf

3. Income confirmation

Income must be from one source and cannot include rental income.

i. Employed income

Please provide the following documents in English. We can also accept certified translated documents from an easily identifiable, fully qualified translator.

• Letter from employer confirming income, position and term of employment / or pension contract
• 1 month salary slip

ii. Self employed income confirmation

If self-employed applicants must have been trading for a minimum of 3 years, please appoint a local fully qualified accountant working in an accountancy firm with a minimum of two partners. To complete Skipton International Accountants Certificate which can be found on our Forms page. The firm and accountant must be:
- Clearly identifiable
- Suitably qualified (local equivalent of ACA, FCA, ACCA, FCCA, IPFA or ICAS)

OR

Alternatively, self employed applicants can provide the last years final income tax assessment (where written in English). 

iii. Pension income – can be from more than one pension provider

• Last 1 months pension slip (can be a copy – certification not required) or if not provided:
• Most recent annual statement from the pension provider (can be a copy – certification not required)

4. Bank statements – can be copies, certification not required

Please provide the following documents in English. We can also accept certified translated documents from an easily identifiable, fully qualified translator. 

• One month bank statement. This must show their salary / pension being credited and mortgages/ rent being debited (if applicable). The statements must detail account holder’s name(s), account number, narrative, debits, credits and running balances.  
• One month UK bank statement.

Any reversals, returned items or debit balances in excess of any overdraft limit should be fully explained with supporting documentation. (e.g. copy of savings account providing evidence of liquid cash available to cover these instances).

Skipton International is unable to process an application where you have either had any reversals, returned items or debit balances in excess of any overdraft limit within the last 3 months.

5. Mortgage statements – can be copies, certification not required

Please provide the latest 12 months mortgage statements for all mortgages held. Statements must detail account holder’s name(s), account number, narrative, debits, credits and running balances.

Skipton International is unable to process an application where you have either had a late or missed mortgage payment within the last 12 months.

6. Source of Deposit Funding

For all purchases you must complete the “Declaration of Source of Funds” section and provide supporting documentation: a list of acceptable documentary evidence is noted with this section. This is not required for remortgages.

7. Gift received (where the deposit or other costs are being donated by a third party and can include gifted equity)

Where the deposit or transaction costs/equity are being donated by a third party, please complete the Gift Letter. Please provide supporting documentation which details the source of funds, a list of acceptable documentary evidence is noted on the form. An amendable version is available on our website www.skiptoninternational.com/forms-download

8. Tenancy agreements

Please supply the latest copy of the Assured Short Hold Tenancy Agreement for ‘The Property’ if the application relates to a remortgage, equity release, further advance and revesting of names. Please see our ‘Property Letting Requirements’ at;

England & Wales: https://www.skiptoninternational.com/sites/default/files/uploaded/forms/Property-Letting-Requirements.pdf

Scotland: https://www.skiptoninternational.com/sites/default/files/uploaded/forms/Property-Letting-Requirements-Scotland.pdf