This section of the site gives you details of our property and construction lending criteria:
Property and construction
Construction types
| Construction types | Lending terms |
|---|---|
| Traditional Construction (Normal lending terms apply) |
Walls
Roof
Spray Foam Insulation If spray foam insulation has been fitted in the wall voids of the property, then the valuer will decline the property. The valuer will decline the property at first, where spray foam has been installed in the rafters, frame, and/or underfloor structure. However, we'll reconsider with evidence of either: Confirmation the installation of the foam is in accordance with the manufacturer’s recommendations, and
Or A Building Surveyor or Structural Engineer should be instructed to undertake an invasive inspection and report on the frame integrity. Where it requires remediation works, you must include an estimated cost. |
|
Non -Traditional Construction |
There are many properties built using a variety of other construction methods. Lending terms vary depending on construction types and if a repair scheme, where appropriate, has been used. Please contact your usual Service Centre where a property is of non-traditional construction with the following details for further advice:
The exact construction name is important as lending terms may differ between different types and year built. For example, our lending terms differ between Gregory, Gregory Drury System 3 and Gregory Housing. All three have different lending terms, and it is important to ensure you give us the full and accurate name to avoid us giving incorrect advice. |
|
Modern Methods of Construction |
We're supportive of development schemes which incorporate Modern Methods of Construction (MMC). Although an MMC scheme must display sufficient robustness, technical rigour and suitability for its location. Due to the wide and changing range of products in the market, we now treat independently each development (not system). Please provide the full information below to enable us to consider your development:
|
| Solar Panels |
We'll lend on a security with an Airspace Lease providing it meets the minimum requirements documented in the UK Finance Lenders' Handbook. Or where the vendor owns the panels. Other arrangements are not acceptable. |
|
Duplex Properties |
The word duplex can be used to denote several property types. Below you can see the circumstances for each one: It can refer to a specific structure type e.g. Duplex Foamed Slag. Maisonettes are where there are two leasehold properties each covering two storeys in a block of four storeys. However, in some developments they are referred to as duplex houses/maisonettes. These buildings can sometimes be known by the name of "Over and Under" properties. They were built up to four or five storeys high in steep hillside terrace form, on a similar arrangement to maisonettes, with each property having ground level access. Some involved back to back arrangements. Construction is normally of stone and quality of construction varies from poor to very good. Essentially these properties are flying freeholds, and normally would not form an acceptable security for the Society. However, the Society will accept these Duplex properties provided the following procedures are strictly adhered to:
The valuer has strict criteria to judge that the Duplex properties are acceptable. |
|
Japanese Knotweed |
We will consider properties with caution any Japanese Knotweed growing within the vicinity. They will be subject to the following terms: If Japanese Knotweed is:
Then the applicant will be required to obtain a specialist report in respect of eradicating the plant. This will include an insurance backed 5-year warranty against re-appearance of the plant. If necessary, we'll require repairs to the property and services for the valuer to make a full assessment of the property's suitability. However, if Japanese Knotweed:
Then we'll require written confirmation from the applicant confirming that they're aware of the presence of this invasive plant. And that it could have adverse effects on the property should it spread closer. The applicant should seek their own independent professional advice regarding the risk this plant might impose. |
Valuations
We’re legally obliged to assess the value of a property for mortgage purposes. This may not involve a physical inspection of the property. If the property is a New Build, the valuation report will be uploaded to the document store within NFI Online. For other applications, we’ll only release a copy of the valuation report in exceptional circumstances.
Your clients are strongly advised to get their own report on the condition and value of the property. We would advise a fuller inspection, such as a Home Survey Level 2 Report (which replaced the Homebuyers Report). Or a Home Survey Level 3 Report (which replaced the Full Building Survey).
Please note: RICS will no longer carry out Homebuyers Reports or Full Buildings Surveys from 1 September 2021. Home Survey Level 2 and Home Survey Level 3 Reports are now the ones to use.
If you're unsure whether the property would be suitable security for us, you can complete this Pre-valuation enquiry form.
Property decision at DIP
In some cases, we'll have enough information on the property at DIP to decide we wouldn't be prepared to lend. For example, if the property is in a known flood area. This will show on the DIP results screen.
- If your client decides to purchase a different property, you'll be able to amend the DIP.
- If you want to challenge the property decision, complete the DIP property decline form. To consider this challenge, you'll need to provide evidence/a valid reason for your challenge.
We need to underwrite some higher risk cases in more detail. To prevent delays for your clients, please see our key information for DIP refer cases.
Mortgage Valuation Report (MVR)/ Further Advance Revaluation Report (FARR)
Where we require a physical valuation, safety is our number one priority. Valuers will need to carry out a detailed safety assessment with the customer before we conducted the valuation. Where a customer isn’t comfortable letting a valuer into their property we’ll place the application on hold. You’ll need to tell us when they’re ready to proceed.
Valuers may carry out an ‘external only’ assessment. They will still complete a safety assessment and the valuer will explain the process to the customer. Where we need more information or require photos of the property, the valuer will request them from the applicant/vendor. If this is necessary, we will provide full support by telephone/email.
We’ll carry out a valuation to ensure the property is suitable for mortgage purposes. It’s important to note:
- Your client won't get a copy of the report.
- The mortgage valuation may not involve a physical inspection or visit to the property. For example, we may use an AVM (Automated Valuation Model) or desktop valuation.
- You must not rely on the report to identify defects in the property. There may be defects that won’t be reported for mortgage lending purposes, but which could be important to your client as the buyer. For their own purposes, your client should consider obtaining a Home Survey Level 2 Report (which replaced the Homebuyers Report). Or a Home Survey Level 3 Report (which replaced the Full Building Survey).
Home Survey Level 2 Report (which replaces Homebuyers Report from 1 September 2021)
- A member of Royal Institution of Chartered Surveyors (RICS) will carry out this report.
- The RICS states you should choose this report when you need more extensive information when buying a conventional house, flat or bungalow. It will need to be built from common building materials and in reasonable condition.
- The focus of the report is assessing the general condition of the main elements of the property. This includes a visual inspection of the building, its grounds and its services (although we won't test the services).
- If it’s safe to do so, we'll inspect concealed areas normally opened or used by the occupiers. For example roof spaces, basements and cellars.
- The report will provide an assessment of the relative importance of any defects/problems.
Read more about the Level 2 RICS report
Home Survey Level 3 Report (which replaces Full Building Survey from 1 September 2021)
- The RICS states you should choose this report if
- dealing with a large, older or run-down property
- a building that is unusual or altered, or
- if you're planning major works.
- It costs more because it gives detailed information about the structure and fabric of the property.
- The service includes an extensive detailed visual inspection of the building, its services and the grounds. It also provides more extensive details than a Level 2 Survey. Although the services aren’t tested, they will be observed in normal operation. In other words, they're switched on or off and/or operated where the occupier has given permission. And it’s safe to do so.
- The report will describe the form of construction and materials used for different parts of the property. As well as the condition and provide an assessment of the relative importance of any defects/problems.
- It will describe any known risks of potential or hidden defects in areas not inspected. The report will propose the most probable cause(s) of the defects based on the inspection. It will outline the likely scope of any appropriate remedial work. And explain the likely issues of non-repair. The report will make general suggestions in respect of the priority and likely timescale for necessary work. The surveyor may be able to provide an estimate of costs for identified repairs if agreed in advance.
Read more about the Level 3 RICS report
If your client would like a Home Survey Level 3 Report:
- You or your client can email us at FullBuildingSurvey@Nationwide.co.uk. You should do this as soon as possible after submitting your case. This will need to include your client’s name and mortgage case reference number.
- We’ll email straight back to say we’ve received the request. And that we’ll provide a further update within 48 hours.
- Once we've allocated the Mortgage Valuation Report, we’ll contact the valuation firm to confirm your client would like a Home Survey Level 3 Report.
- We’ll email you or your client (depending on who emailed us for the Home Survey Level 3 Report request) to confirm the valuation’s been placed. We'll then contact your client by the valuation firm regarding their Home Survey Level 3 Report.
- Your client will need to pay the Home Survey Level 3 Report fee direct to the valuation firm. Or, your client can approach a different company to get a Home Survey Level 3 Report quote.
You're not required to enter any notes regarding the Home Survey Level 3 Report on NFI Online.
Home Survey Level 2 and Level 3 Report fees
| Property value | Home Survey Level 2 Report fees (includes VAT) | Home Survey Level 3 Report fees (includes VAT) |
|---|---|---|
| £0 - £50,000 | £350
|
£895
|
| £50,001 - £100,000 | ||
| £100,001 - £150,000 | ||
| £150,001 - £200,000 | ||
| £200,001 - £250,000 | ||
| £250,001 - £300,000 | £450
|
|
| £300,001 - £350,000 | ||
| £350,001 - £400,000 | £1,080
|
|
| £400,001 - £500,000 | ||
| £500,001 - £600,000 | £675
|
£1,260
|
| £600,001 - £700,000 | ||
| £700,001 - £800,000 | ||
| £800,001 - £900,000 | £1,795
|
|
| £900,001 - £1,000,000 | ||
| £1,000,001 - £1,500,000 | £1,025
|
£2,250
|
| £1,500,001 - £2,000,000 | ||
| £2,000,001 - £2,250,000 | £2,800 | |
| £2,250,001 - £2,500,000 |
£2,950 | |
| £2,500,001 - £2,750,000 | £1,800
|
£3,200 |
| £2,750,001 - £3,000,000 | £3,300 | |
| £3,000,001 - £3,250,000 | £3,500 | |
| £3,250,001 - £3,500,000 | £3,600 | |
| £3,500,001 - £3,750,000 | £3,770 | |
| £3,750,001 - £4,000,000 | £3,900 | |
| £4,000,001 - £4,500,000 |
Price on application
|
|
| £4,500,001 - £5,000,000 | ||
| £5,000,001 - £6,000,000 | ||
| £6,000,001 - £7,000,000 | ||
| £7,000,001 - £8,000,000 | ||
| £8,000,001 - £9,000,000 | ||
| £9,000,001 - £10,000,000 | ||
Equity Share, Shared Ownership and Restricted Resale Price applications
We'll base the valuation fee on the full open market value of the property.
New Build valuations
Please visit our dedicated New Build page for information.
Home Reports in Scotland - Single Surveys
From 1 December 2008, all vendors of a residential property in Scotland must provide potential purchasers with a copy of a Home Report Pack. This will contain a Single Survey, Energy Report, a Property Questionnaire and a generic Mortgage Valuation report.
Transcriptions
From 1 February 2010 the only transcriptions accepted are those arranged under the Scottish Home Report (single survey) process for purchase mortgages introduced in December 2008. Transcriptions aren't accepted for remortgage applications and those relating to new build properties.
For acceptance of these transcriptions the following points apply:
- The valuer providing the transcription must be the individual who prepared the original Home Report or inspected the new property.
- The firm employing the valuer must be on the Nationwide panel.
- The valuation figure cannot be older than 90 days from the date of inspection.
- Where the valuation figure is a result of a 'refresh' of the original Home Report, it must be based on an internal/external inspection that has taken place within the last 90 days.
The transcript will only contain the same information and valuation figure as the Single Survey. A valuer may, at the request of the seller, update ("refresh") the report which could result in changes, including the valuation figure. To refresh a report the valuer must re-inspect the property.
Nationwide will instruct valuers to forward transcripts only if they have inspected (or re-inspected) the property within 3 months from receipt of our instructions.
Instructing valuation
- Where a Single Survey has been prepared by a panel valuer, you need to request a transcription. You can do this via NFI Online in the usual way.
- Countrywide surveyors will reject where they:
- receive the transcript requests, but the valuer isn't on our panel.
- receive the instruction request but can't issue a transcript.
Where you can't provide a transcription, we'll let you know. We'll then arrange a standard valuation.
Exempt properties
If you plan to occupy the new and newly converted properties as residential units for the first time. These are exempt from the requirement to have a Home Report Pack or single survey.
Scottish Valuation Instructions
| Home Report | Private/Self Instruction | Nationwide to Instruct | |
|---|---|---|---|
| Open Market Sale (non-New Build) | Yes | No | Yes (optional) |
|
Transcripts of home reports are acceptable for open market purchases providing the surveyor is on Nationwide's panel. If the surveyor who prepared the original home report is not on Nationwide's panel then Nationwide must instruct the valuation. You must have had carried out the original home report prior to the date of the mortgage application. It is acceptable, for any required refresh to have a date after the mortgage application. |
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| New Build Purchase | N/A | No | Yes (compulsory) |
|
Nationwide must instruct the valuation in all New Build cases. Even if there is a valuation available for a transcription. |
|||
|
Remortgages |
No | No | Yes (compulsory) |
For all remortgages Nationwide must instruct the valuation. There are no situations where Nationwide will accept a:
|
|||
|
Non Open Market Sale - Private/Family Sale/Right to buy etc |
No | No | Yes (compulsory) |
| Nationwide must instruct the valuation in these cases. Even if there is a home report transcript or self instructed transcript available. | |||
Valuation appeals
If you wish to appeal the valuation figure, it’s important that it fits our criteria. We'll need the following information to consider your appeal. We will reject appeals which do not provide the following:
- Details of at least two comparable properties. They must be of similar type, style, size and location to the subject property. And be sold/rented within the last six months.
- A summary/additional comparable explaining why you're appealing the valuation based on the information. You also need to provide comparable evidence.
- For New Build properties, we require three comparable sales:
- one from the same site
- one from a similar local New Build site
- and a second-hand property in the local area
Important information:
- We will reject appeals received with missing information, or which don’t meet the necessary requirements.
- You can only appeal valuations within 10 working days of you or your client being made aware of the valuation outcome.
- We’ll respond to the appeal within 7 working days. The response will be the final outcome. You will not be able to appeal the valuation again.
It’s important that you review the above criteria first before contacting us. Once you have all the relevant information to hand you can contact broker support. They will send you the Valuations Appeal form, which should be submitted to valuation.appeals@nationwide.co.uk.
Switcher valuation appeals
If you or your client wish to appeal the property valuation figure returned by NFI Online as a part of a rate switch application, please complete the Rate Switch Valuation Appeal Form. Then you need to email this to switchervaluationappeals@nationwide.co.uk
Lending for flats
| Flat type | Criteria |
|---|---|
|
Non New Build |
We have increased the maximum LTV on non New Build flats (with a minimum lease term of 90 years) to:
|
|
Blocks of flats up to |
All flats in blocks and Scottish tenements not exceeding five storeys* in height, will be acceptable at the discretion of the valuer. This is subject to the valuer accepting the guidelines and restrictions on non-traditional construction. The instructed valuer will then report on whether the flat satisfies our requirements in terms of construction, marketability and any other associated matters. Flats in blocks over 4 storeys high should have a lift. This also applies when the subject flat is on the lower floors. We can make some exceptions, but this is subject to marketability and valuers’ recommendation. *Five storeys means a ground floor with four floors above, ignoring any basement. |
|
Flats over five |
We won’t accept former local authority flats in blocks of more than five storeys. Or maisonettes and Scottish tenements in blocks of more than five storeys that were, or still are in local authority ownership. |
|
Flats in the same |
The acceptability of a flat in the same block as commercial properties will depend on:
These are in addition to the usual construction and marketability criteria. We recommend you contact us with as much information as possible at enquiry stage. This will allow us to contact a valuer for advice before issuing formal valuation instructions. The valuer must consider the majority of the flats in the block to be suitable securities for us to lend. |
|
Coach house |
Coach house flats are acceptable subject to a satisfactory valuation. A coach house flat is a freehold flat, which is:
|
|
Freehold flats and |
In general, we won't accept:
For most cases described as a 'freehold flat' there is usually no lease on the occupied flat. And the occupier of the flat will most likely be the freeholder of the whole block. Acceptable
Unacceptable
|
|
Studio flats |
Studio flats are acceptable to Nationwide with no minimum floor area requirement. This is subject to marketability and valuers’ recommendation. |
Tenure
The maximum LTV on non New Build flats (with a minimum lease term of 90 years) will be increased to 95% for purchases and 90% for remortgages.
We will lend on:
- Freehold - houses and bungalows
- Leasehold (including good leasehold title)
- Commonhold
- Ownership (Scotland)
- Flying Freehold (subject to confirmation from the valuer that the property is suitable security)
Minimum Leasehold Terms
| Criteria | |
|---|---|
| England and Wales |
Flats and Houses - we require a minimum unexpired lease of 55 years at application. This along with a minimum unexpired lease term of 30 years after mortgage term ends. Where your client is looking to purchase a new longer lease or lease extension, we'll process the application using the details of the new/extended lease. We'll allow lease extensions on new and existing lending, if it's completed under the Leasehold Reform Act. |
| Northern Ireland |
Flats and Houses - a minimum unexpired lease term of 50 years after mortgage term ends. |
|
Scotland |
Flats - a minimum unexpired lease term of 50 years after mortgage term ends. Houses - refer to your usual Service Centre. |
Valuation criteria
- The valuer must be satisfied that there is a market for any property taking the lease term into consideration.
- Although an application may meet the guidelines above, the valuer may decline the property. For example a mortgage application in England for a 20-year term with a 56-year unexpired lease within policy. The valuer may advise the property is not readily marketable and saleable, and we'll therefore not consider the property as suitable security.
Lease Terms
- The valuer must confirm that there is a market for any property, taking into account the lease terms, which must be reasonable.
- Where the valuer believes the lease terms will impact the marketability. They may reflect this in their valuation, For example:
- where ground rent escalation is linked to the value of the property. Or the index is greater than The Retail Price Index (RPI)
- where lease clauses appear onerous, e.g. disproportionate Service Charges or Event clauses for normal use, such as installing an aerial
- Some lease terms will severely impact marketability that they will result in the decline of a property. For example:
- where ground rent is greater than or equal to 0.5% of the property value. Or where the review period is less than or equal to 5 years.
- where ground rent doubles in less than 20 years (e.g. every 5, 10 or 15 years). Or escalates by compounded RPI.
- Please note that there are different limits for acceptable New Build Lease Terms. See our New Build page for detail.
These examples aren’t exhaustive. The solicitor is expected to refer back to us any lease terms they feel may affect the value or future sale ability of the security.
Part Commercial Properties
| Type of Property | |
|---|---|
| We can accept some part commercial properties on normal residential terms (subject to a satisfactory valuation) |
We won't lend on residential terms where any part of a property has one or more of the following commercial uses: |
We'll accept where the business income is required to support the mortgage (subject to it satisfying our normal underwriting requirements). |
|
For part commercial properties not covered above
Contact your New Business Service Centre to find out if the property is suitable for a residential valuation.
Properties with Large Acreage
- The applicant must use the entire property or land for their own residential purposes.
- We'll give special consideration to large acreage/properties.
Estate Charges
- Estate Rent Charges or Estate Management Charges can apply to freehold or leasehold properties.
- Charges must be reasonable at all times. Where charges are greater than £500 per annum, you'll need to advise us what the charges cover. This is so the valuer can assess whether there's any change to the valuation.
Geographical Area
We'll lend to the following areas
| UK Mainland |
Properties in mainland England, Wales, Scotland and Northern Ireland. |
|---|---|
| Scottish Islands |
We'll consider Mortgage applications on Scottish Islands for properties located on:
Individual consideration will be given to properties on the following Scottish Islands:
|
We will not lend to any Scottish Islands not included in the above list or the below islands
- Isles of Scilly
- Channel Islands
- Eire (Southern Ireland)
- Isle of Man
Fire safety assessment
All Multi-storey/multi-occupancy buildings under 11 metres (or 4 storeys or less) in UK and 11 metres or more (or 5 storeys or more) in Wales, Scotland and Northern Ireland
They’ll decline the property pending receipt of an EWS1 form. Where a valuer has cladding or non-cladding fire safety concerns with external wall systems, attachments (e.g. Balconies), or any other significant fire safety concerns.
The form must be:
- obtained from the building owner (property owner in Scotland). The ‘Client organisation’ on the form must be the building owner. We won't accept it in the name of the applicant/client.
- fully completed and accompanied by a headed paper letter from the signing firm which details
- their area of business
- qualifications
- confirmation that they've completed the form.
It's the duty of the building owner to ensure the signing firm is a member of an appropriate professional body. See the RICS website for more information.
The specialist will complete the form and select either ‘low risk’ or ‘high risk’ and will then choose a rating of either:
- A1, A2 and B1 - we’ll send the form to the valuer for assessment. If accepted they’ll provide an amended valuation report.
- A3 or B2 - we’ll assess the case and let you know our decision. We may request confirmation from the building owner about the remedial building work required. And who’ll be liable for the cost of those works. For Scotland, we'll require confirmation from the building factors/managing agents acting for the co-proprietors.
For all application types where the building owner will cover the remedial costs, we’ll require confirmation in writing from the building owner that:
- you will compile the EWS1 requirements and render the building fire safe (i.e. fall within the definition of A1, A2 or B1) on completion of the remedial works.
- the interim fire safety measures are satisfactory.
- you will not pass on costs or hidden charges to the leaseholder (e.g. via service charges).
- remediation will take place within a reasonable timescale (12 months).
Where remedial costs fall to individual leaseholders/flat owners
For remortgage and purchase, as long as the building owner’s solicitors confirm in writing, we’ll consider applications where the owner has paid for and planned/started remedial works. We’ll decline any applications if remedial works have not yet been paid for or planned/started.
For further advances, we’ll consider applications if the funds are being raised to carry out the required remedial works. We'll require further information from the building owner in order to make an assessment, including:
- the compiled EWS1 requirements rendering the building fire safe (i.e. fall within the definition of A1, A2 or B1) on completion of the remedial works.
- confirmation the interim fire safety measures are satisfactory.
- a summary of the remedial works required and when the works will take place.
- costs the leaseholder/flat owner is liable for and when the required funds are due to be paid to the freeholder.
All multi-storey/multi-occupancy buildings 11 metres or more (or 5 storeys or more) in England
With the Building Safety Fund (and other Government/non-Government schemes), and the RICS updated guidance in relation to the assessment of multi-storey/multi-occupied buildings over 11 metres/5 storeys in England, our mortgage valuation criteria is as follows:
- Where a valuer has cladding or non-cladding fire safety concerns with external wall systems, attachments (e.g. Balconies), or any other significant fire safety concerns, they’ll decline the property. This is pending receipt of the following, which must come from the ‘Responsible Person’ i.e. Building Owner and/or Managing Agent:
- An Executed Leaseholder Deed of Certificate and Landlord Certificate (where they will remediate* in full the building under a Developer/Government/Freeholder Scheme. We won't require these certificates, but you will still need all other documentation below.
- Confirmation of any costs and amounts not covered by the Building Safety Fund or other Scheme (i.e. Capped/non-capped charges).
- Confirmation of interim fire safety measures.
- One of the following:
- Confirmation from the ‘scheme provider’ that they will remediate* the building under a Developer/Government/Freeholder Scheme, or
- A Fire Risk Assessment of External Walls report (FRAEW) with an indicative rating or
- An EWS1 form**, or
- A letter stating why none of these are available.
OR
- A signed letter confirming:
- There are no fire safety issues.
- They have complied the requirements of the Building Safety Act 2022. And they have either an A1/A2/B1 rated EWS1 form or a Fire Risk Assessment of External Walls (FRAEW) report which confirms no work required.
- There are no fire safety costs for the leaseholder to pay.
* Where there are plans for remediation, it will need:
- Confirmation of whether there is requirement for remediation or mitigation. We only need a brief summary.
- Confirmation of source of funding (including Remediation Order or Remediation Contribution Order).
- Proposed/forecasted start/end dates.
** EWS1 forms must be:
- obtained from the building owner. The ‘Client organisation’ on the form must be the building owner. We won't accept it in the name of the applicant/client.
- fully completed and accompanied by a letter (on headed paper) from the signing firm. It must detail their area of business, qualifications and confirmation that they have completed the form.
It's the duty of the building owner to ensure the signing firm is a member of an appropriate professional body. See the RICS website for more information.
New Build fire safety assessment
On 21 December 2018, The Building Regulations 2018 banned the use of flammable materials on new high-rise homes. Any buildings started after 21 February 2019 should not contain flammable material.
We require an EWS1 form for any New Build designed/constructed under the old regulations. This is regardless of storey height. For example, where there are concerns around wall systems and attachments.
We won’t require an EWS1 form for New Builds that have been/are being constructed in compliance with The Building Regulations 2018. Unless upon inspection, the valuer has concerns regarding other elements of fire safety.
We'll speak to the Developer/Sales Agent. If the valuer can’t confirm that the latest Building Regulations apply, we'll decline the mortgage valuation report. This is pending confirmation from the Building Owner/Developer/Conveyancer whether it’s compliant with The Building Regulations 2018.
Read more about New Build construction
New Build property
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