Lending Criteria – Property Development Loan

BlueZest Lending Criteria – for Intermediaries

To be simple and clear, please find below a guideline of our lending criteria. This allows you to see the requirements for the products we have on offer and any particular specifics you may wish to know. Please note; this is not our full mortgage lending policy.

Affordability
  • Value of property

    Value of property for transfer to Buy-To-Let mortgage,  LTV at maturity of loan should be less than 75%

  • Rental coverage

    Estimated rental coverage at development completion being within BlueZest’s Buy to Let policy criteria

Applicants
  • Number of applicants

    Maximum 4 applicants – all Directors must be party to the loan agreement

  • Applicant residency

    All applicants must reside within the UK and have done so for the last 3 years with indefinite leave to remain, holding a UK bank account

  • Party to the mortgage

    All registered owners of the secured property must be party to the mortgage

  • Convictions

    Applicants must not have any unspent convictions for offences, other than minor traffic offences

Credit History
  • Must have
    • Applicants must be creditworthy and have a good track of servicing loans/credit agreements as evidenced at a Credit Reference Agency
    • Additionally, applicants must not be overcommitted on other secured and unsecured borrowings
  • Declined if

    Mortgage applications will be declined if any applicant has had:

    • Any previous property repossessed
    • A County Court Judgment (CCJ), satisfied or unsatisfied
    • An insolvency (including those pending)
    • Any Debt Management Plan in place
    • Any loan defaults  in the last 36 months
    • Any mortgage arrears in the last 12 months
    • Any “pay day” or “doorstep” loans in the last 36 months
Employment/
Income
  • Employment

    The company must have been continuously trading for at least 2 years (and be able to provide accounts/tax returns for this period)

  • Income

    The main applicant should have a minimum gross basic annual income (including dividends and pensions) of £25,000

Loan Purpose
  • Capital raising

    Capital raising for purchase and/or development of a Buy to Let property

Residency
Acceptable Properties
  • Acceptable Properties
    • Properties must be located in England or Wales
    • The property should have a minimum value of £75,000
    • New build properties are acceptable
    • Freehold flats are not acceptable
    • A minimum of 45 years must be remaining on the lease after the end of the mortgage termand/or 55 years at the beginning
    • All properties must be of standard construction
    • Properties used as loan security must be deemed suitable for residential occupation/letting post development by the valuer
    • Property must be deemed to have good marketability by the valuer
    • Property must have buildings insurance on normal terms
    • Property must not have any agricultural restrictions
    • Property must not cover more than 10 acres
    • Farms and smallholdings are not acceptable
    • Common-hold properties are not acceptable
    • Ex-Local Authority flats/maisonettes with a value of less than £250,000 are not acceptable
    • Flats above 4 storeys must have a value of at least £300,000
    • Property must not be subject to any constraint preventing occupation for 52 weeks a year
    • Shared ownership properties are not permitted
  • The following will not be considered:
    • ­Properties affected by HS2
    • Property where material environmental hazards are present
    • Properties affected by Japanese knotweed
    • Properties affected by overriding interest
    • Mobile homes and houseboats
    • Grade I (England & Wales) listed buildings
    • Less than 10 years old without NHBC/Zurich Municipal guarantees or architects certificate
    • HMOs
    • Unlicensed Multiple Occupancy
    • Housing – e.g. student residence
    • Flats directly above food premises

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You do not have to complete your application in one go; you can stop at any time. The information entered will be automatically saved, so you can resume and complete your application whenever convenient.

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