Vida was forced to halt lending in March when the coronavirus lockdown was introduced and capital markets closed-up, but after completing a £350m securitisation in July it has been able to relaunch.
Mortgage Solutions understands Vida will be expanding its proposition in the next few weeks as it rolls out to the market again.
As part of its return the lender has introduced specific criteria to tackle the new economic environment, including payment holidays, furlough and bounce back loans.
Where payment holidays are concerned, for residential and buy-to-let, applicants must have finished the payment holiday for secured and unsecured loans, with evidence of at least one payment made on their most recent mortgage or bank statement.
Residential applications from currently furloughed borrowers will be accepted provided they are returning to work within the four weeks following the application date.
However an offer will not be issued until they have returned to work and non-guaranteed income will not be included.
For borrowers who have already returned from furlough, an employer form is required along with further evidence.
Self-employed borrowers will be considered, although additional documentation and information will be required, and those utilising the government’s Self-Employment Income Support Scheme (SEISS) must be back to full-time work.
For landlord borrowers who have been furloughed, in all cases Vida will require the latest month’s bank statement, showing sufficient funds to cover three months’ payments or regular rental income from the portfolio.
First-time landlords and top-slicing are not permitted where the applicant is currently or was previously furloughed.
The same requirements and restrictions also apply to self-employed applicants.
Bounce back loans and Coronavirus business interruption loans cannot be used as part of the applicant’s income or to fund any part of the deposit.
Vida will not accept applications where these types of loans are secured against the security address. It will also require information related to the loan, for example the loan amount, the monthly payment and reason for the loan.
Regular non-guaranteed income is not acceptable for top-slicing or first-time buyer’s buy-to-let affordability assessment.
Limited company lending is open to special purpose vehicles, but not trading limited companies.
The highly active market driven by the stamp duty cut combined with social distancing restrictions for employees has meant many lenders have been hit by challenges maintaining services levels and have limited supply.
Louisa Sedgwick, managing director mortgages at Vida, told Mortgage Solutions that she was aware of the situation the lender was relaunching into.
“We will of course be monitoring applications daily. Because we don’t have a pipeline of applications yet, we can actively manage the volumes,” she said.
Sedgwick continued: “Our intention at Vida has always been to get back to lending. We want to support Britain’s underserved borrowers and we plan to return with a renewed ambition to change mortgages for good.
“As we prepare to return to the mortgage market, we’ve made our standard mortgage range of products up to 85 per cent LTV available to intermediaries through sourcing systems.
“We will be testing everything over the next week to make sure we can deliver the best possible service to our intermediary partners.
“However, we’re at the very start of a new journey for Vida and we have some exciting announcements in the pipeline as we invest in our proposition to innovate for intermediaries and our customers.
“We’ll have more to announce on these plans very soon,” she added.