Nationwide Building Society

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Nationwide Building Society Mortgages for Contractors: 

Nationwide Building Society recognizes the diverse nature of employment arrangements, including those of contractors and self-employed individuals. MortgageTek provides a comprehensive understanding of the lending criteria applicable to contractors. Ensuring compliance with these criteria is crucial for a successful mortgage application with Nationwide.

Nationwide Employment Income

Fixed Term Contracts:

A fixed-term contract refers to employment for a specific duration, with the possibility of renewal or extension. To meet Nationwide’s criteria:

Minimum Employment Duration: Applicants must have been employed on a fixed-term contract for at least 12 months.

Contract Remaining:  Applicants must have been employed on a fixed-term contract basis for a minimum of 12 months. If they have not, they must have at least 24 months remaining on their current contract. The gaps between contracts in the past 12 months can total no more than 12 weeks.

Gap Between Contracts: Gaps between contracts in the past 12 months should not exceed 12 weeks.

Consideration for Approval:

  • Length of time with the current employer.
  • Contract renewal history.
  • The remaining term of the current contract.
  • Likelihood of obtaining alternative employment at a similar salary.
  • Connection of the contract to a specific project.

Note: If invoicing is done through a limited company not owned solely by the applicant, they are treated as self-employed.

Proofs Required for Fixed-Term Contracts:

  • Copy of the current employment contract as proof of income and employment.

Temporary Workers:

Nationwide accepts clients employed on temporary contracts through agencies. The agency must provide an employer’s reference confirming employment for a minimum of 12 months.

Nationwide Building Society has specific mortgage lending criteria that apply to contractors.

Applicants  in First Job for One Month or Less:

For those in their first job for a month or less, proofs required include:

  1. Latest payslip (basic income only).
  2. If no payslip, an open-ended employment contract or a letter of appointment.
  3. Three months’ bank statements.
  4. Proof of deposit.

Note: For existing Nationwide clients, existing account statements may suffice.

Applicants  Starting a New Job within Three Months:

Nationwide considers clients starting a new job within three months of the mortgage application. Proofs required:

  • Latest payslip (basic income only).
  • If no payslip, an open-ended employment contract or a letter of appointment.

Exception: An employer’s letter is needed for pay rises not reflected in the latest payslip or for clients returning to work after parental leave.

Probationary Employment:

Nationwide considers clients on probationary employment.

Seafarers Earning Deduction (SED):

For employed applicants showing no UK tax and NI deductions on the latest payslip, Nationwide requires:

  • Latest UK tax calculation and corresponding tax year overview. OR
  • An employer letter confirming permanent employment, core contractual income in sterling, and exemption from UK tax.

Income Proofs Required for Employed Applicants:

Nationwide may verify income using credit bureaus. Unnecessary proofs may delay the application.

Nationwide Self-Employed Mortgage Applicants:

Directors of a Limited Company:

For directors of a limited company, Nationwide requires:

  • Last 2 years’ income verification using HMRC tax assessment or accountant’s certificate.
  • No drafts or projections; income figures are annualized if the last accounting period exceeds 12 months.

Note: Existing Nationwide borrowers may contact for referral to senior underwriters if criteria are challenging.

Nationwide Self-Employed Mortgages:

For self-employed individuals applying for a mortgage:

  • A minimum trading period of 2 years is required.
  • Income from those self-employed outside the UK is not acceptable.

Sole Traders and Partnerships:

For sole traders and partnerships, Nationwide requires:

  • Last 2 years’ income verification using net profit figures.
  • Calculation is based on the lower of the most recent year or the average of the last 2 years.

Nationwide mortgages for Fixed Term Contractors:

Treated as employed or self-employed based on trading history. Additional requirements for joint applications and limited companies.

Umbrella Companies:

For applicants with a minimum 12 months of consecutive fixed-term contract history via an umbrella company.

Sub-Contractors Invoicing Employers:

Treated as self-employed. Criteria for deductions and proofs vary based on tax treatment by the employer.

Foster Carers:

An income confirmation letter from the placing agency is required.

Seafarers Earning Deduction (SED):

Self-employed income guidance applies; the latest 2 years UK tax calculations are required.

Income Proof Requirements for Self-Employed Applicants:

  1. HMRC Tax Calculation (SA302) forms and Tax Year Overviews or Accountant’s certificate.
  2. Details for clients submitting returns online or via paper.

Note: Specific requirements and criteria apply; unnecessary attachments may lead to assessment delays. Contact Nationwide for potential referral to senior underwriters for deviations from criteria.

Understanding and adhering to Nationwide’s lending criteria is crucial for a smooth mortgage application process. Applicants and their advisors should carefully review and provide accurate documentation to ensure compliance with these guidelines. For further clarification or deviations, contacting Nationwide directly is advisable.