Product Switchers - Additional borrowing: In line with new business we will be limiting applications for additional borrowing as part of a product switch to 80% LTV, i.e. the combined product switch and additional borrowing must not be greater than 80% LTV.
1) Since I introduced my customer to you my client circumstances have changed and they would now not meet your new business criteria , as an example less than 12 months on a zero hours contract . In these circumstances does that mean we cannot submit the Additional Borrowing application?
In order to apply for additional borrowing, the customer has to meet our lending criteria?
2) What types of applications can I request Additional Borrowing for?
Only available to residential mortgages.
3) What areas are out of scope for the Additional Borrowing process?
The following do not fall within this process: - Additional borrowing outside a product transfer window period, Buy to Let product transfers, clients in arrears, or clients with more than five sub accounts.
4) What happens if my client has been declared bankrupt?
You cannot consider your client for additional borrowing if the bankruptcy is within the last 6 years.
5) What happens if my client has involuntary agreements (IVA’s) against their name?
You cannot consider your client for additional borrowing if these have been within the last 6 years.
6) What do I do if my client wants to borrow less than £10,000?
The minimum the client can borrow under additional borrowing against their mortgage is £10,000, should they require a lesser amount they will need to explore via other forms of finance.
7) What do I do if my client wants to borrow more than £500,000?
Further advance on a mortgage is restricted to £500,000 lending above that amount is not allowed.
8) Is the additional borrowing offered on interest only?
No. The additional borrowing is on a capital and interest basis even if the client is an interest only client.
9) What do we do if the interest only client does not have a repayment strategy in place?
Where the client has in interest only element to their existing mortgage if they do not have an adequate repayment strategy in place they will not be considered for additional borrowing.
10) My client’s income was made up with a combination of UK Sterling and Euro – this was fine when I placed the mortgage with you. I presume that for the additional borrowing application you can again take the additional non-Sterling currency into account?
We can only accept UK sterling as income on additional borrowing cases.
11) During the Corona virus pandemic can customers still apply for debt consolidation while on payment holidays?
From 6th May, customers who are currently taking a payment holiday will not be able to consolidate their debts within a mortgage. This includes where the customer is taking a payment holiday on their mortgage or unsecured lending such as loans or credit cards with us or another lender. In line with our purpose, refinancing unsecured debts against a customer’s home would not be responsible when customers are unable to make their normal repayments.
12) How can the client pay the product fee?
The product fee can be paid in one of two ways:
1 Up front – There will be a notification to the client from NatWest advising how to pay, which will be done over the telephone using a payment card.
2 Add to additional borrowing – The amount is added to the loan and the customer will pay interest on the fee along with the loan.
13) Can my client have different rates for their additional borrowing to the rest of their mortgage?
Where a client is taking additional borrowing, the same rate will be applied to this and their product switch element of their mortgage.