Clarification of Builder Deposits, Vendor Deposits and Family Purchases

Builder Deposits

When any deposit/ incentive or cashback is being paid by the builder this must be disclosed on the application form. It is likely that the property will be valued net of this incentive and a deposit, appropriate to the product selected, must then be paid on the valuation amount (net of the incentive).

For new build property a second-hand valuation will be used to calculate the loan to value.

From the 20th October 2008, the maximum loan to value for new build properties is 80%. This excludes shared ownership applications that are subject to the shared ownership criteria.

Vendor Deposits

When any deposit/ incentive or cashback is being paid by the vendor this must be disclosed on the application form. It is likely that the property will be valued net of this incentive and a deposit, appropriate to the product selected, must then be paid on the valuation amount (net of the incentive).

Family Purchases

Gifted family purchases will be considered for vanilla lending (prime residential lending excluding buy to let properties) where the gift is being given by a family member defined as one of the following; spouse, parent, grandparent, sibling, child, grandchild. The amount of the gifted deposit must be disclosed on the application form. The property valuation recorded in these instances is that of the valuer.

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