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Maximum borrowing amounts and higher lending charge
The maximum amount you can borrow, and whether you are required to pay a higher lending charge, depends on the percentage of your loan to valuation of your property. The premium will be charged on the amount of the loan above 75% of the purchase price, or valuation if lower. This premium will be retained by the bank and will not be used to purchase mortgage indemnity insurance. The scale charges are:
| % Loan to Valuation | Maximum Loan Size | Higher lending charge rate |
|---|---|---|
| Up to 85% | £750,000 | N/A |
| 85.01% - 90% | £400,000 | N/A |
| 90.01% - 95% | £300,000 | 8.95% |
| 95.01% - 100% | £250,000 | 12.00% |
NB. The maximum for the Professional scheme is £250,000 for loans between 90.01% and 100% LTV. The maximum loan size for our fixed rates and remortgage only products (up to 85% LTV) is £500,000. Loans in excess of this will be considered on an individual basis.
back to topHigher lending charge example
Based on a mortgage of £50,000 on a property valued at £55,000. The loan is 90.01% of the valuation so the HLC rate from the table is 8.95%. 75% of the valuation of £55,000 is £41,250 which is then deducted from the loan amount of £55,000 i.e. £8,750, This multiplied by the HLC rate of 8.95% gives a HLC charge of £783.13.
Higher lending charge - Further Advance
A higher lending charge will apply if the total borrowing secured by the property is more that 90% of the valuation of the property, or projected valuation.
The scale charges are:
| New LTV (projected loan to value) | Higher lending charge rate |
|---|---|
| Up to 90% | No charge |
| 90.01% - 95% | 8.95% |
The calculation is:
| Existing mortgage | New loan required | Total borrowing | Projected value | New LTV | Higher lending charge |
|---|---|---|---|---|---|
| £30,000 | £16,000 | £46,000 | £50,000 | 92% | £1,432 (8.95% of £16,000) |
Fixed rate mortgages: subject to availability of funds. Where a fixed rate is chosen, we advise that funds are booked as soon as possible.
Fixed rate arrangement fees: apply on booking a fixed rate and can be added to the loan. The mortgage must be drawn down within three months of the booking fee being incurred. This fee is retained by the Bank if you cancel the booking.
Arrangement fees can be added to the loan.
Legal and Valuation Fees: These may be added to the loan, subject to the maximum loan to valuation, except for 100% LTV mortgages where the maximum that can be added is: £3,000 for loans £120,00 and over; £1,000 for loans under £120,000.
Facility to Value (FTV): Your agreed borrowing limit for an Offset Flexible Mortgage, expressed as a percentage of the property value (or purchase price if lower). The maximum FTV is 100%, including any fees that are added to the loan.
Loan to Value (LTV): Your loan expressed as a percentage of the property value (or the purchase price if lower).
Variable rate mortgages: Interest rates are subject to change and can go up as well as down. Your monthly payment amount will move accordingly.
Remortgage products: For all remortgage products, the Bank will pay the valuation fee and its legal costs for completing the security, providing the Bank's nominated solicitor and valuer are used. You will be required to pay any expenses relating to unusual matters and any early repayment charge, which may be charged by your existing lender. You are entitled to independent legal advice and will be responsible for that cost.
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