Nationwide further tightens criteria for new mortgages as coronavirus crisis bites
Building society Nationwide has further tightened its lending criteria, excluding bonus, overtime and commission as income it recognises for new mortgage applications.
The move follows its decision yesterday to withdraw its offering for low deposit borrowers.
Nationwide yesterday withdrew mortgages above 75 per cent loan-to-value (LTV) from its online and broker channels and restricted them for people seeking remortgages and first time buyers.
Today, the building society confirmed the new restrictions on the type of income it will recognise which it said would come into effect from tomorrow.
A Nationwide spokesperson said: “Although Nationwide continues to process as many applications as possible, as a responsible lender it is important that we ensure that members can afford their mortgage payments during these uncertain times.
“As a result, we are temporarily removing bonus, overtime and commission as income we can accept on new mortgage applications, but we will keep this position under regular review.
“These changes are for new applications made as of 2 April and do not impact existing applications, which will continue to progress.”
Last week, the government effectively put the UK’s housing market on hold, urging people in the early stages of buying or selling houses to delay the process and stopping estate agents from marketing new homes.
Nationwide is the latest lender to pull mortgage products from the market as providers rush to manage the fallout from the coronavirus pandemic.
Lloyds Banking Group — which includes Halifax and Scottish Widows and is the UK’s largest lender — has capped lending at 60 per cent LTV.
Barclays has limited the number of mortgage applications it is accepting from brokers and has limited high LTV products, while Vida Homeloans and Together Money have halted all new mortgage lending.