Residential  

Building society overhauls mortgage criteria

Building society overhauls mortgage criteria

Hanley Economic Building Society has changed its mortgage lending criteria after an “extensive” review of its product range.

The changes include an extension of its mortgage offer validity period to six months as standard from its previous three months.

A minimum property value of £50,000 has also been implemented across all product types. The value, which previously differed for all product types, has been standardised to include products such as buy-to-let, retirement interest-only (RIO) and self-build.

Revisions to employment and income criteria have also been made, with Hanley Economic now accepting pending pay rises that are due within three months across all mortgage types, with written confirmation from the applicant’s employer.

Additionally, the lender will now consider a second job for employed and self-employed applicants across all mortgage types.

David Lownds, head of marketing and business development at Hanley Economic Building Society, said: “Like all lenders, the lockdown period has caused us to re-evaluate our products, criteria, policy, technology, procedures and processes. When it comes to criteria, feedback from our intermediary partners focused on clarity and simplicity, especially within such a transitional marketplace.

“In the past we’ve had many criteria particulars across different product ranges. While some of these remain necessary for regulatory and responsible lending purposes, we have tried to standardise others where possible.

“We still pride ourselves on our flexibility – and each case will continue to be assessed on an individual basis by the in-house underwriting team – but it’s vital that we, as a progressive lender, are constantly evolving to make life as easy as possible for intermediaries and their clients.”

The building society said the overhaul had formed part of a project to review its lending procedures in a bid to simplify its lending policy and criteria for intermediary partners and their clients.

Commenting on the review, Aaron Strutt, product and communications director at Trinity Financial, said: “During the coronavirus crisis there have been lots of negative criteria changes so it is good to see some positive news. 

“It is good to have six-month mortgage offers and another lender to take future pay rises, as well as an additional option for clients with adverse credit.  

“Our advisers seem to be getting even more complex mortgage enquiries than normal from people with a huge array of financial situations, so we need more lenders to ease their criteria again.”

chloe.cheung@ft.com