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Scottish Widows Bank adds to Interest-only Repayment Options

03 April 2017

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Scottish Widows Bank has expanded repayment options on selected interest-only mortgage products.

The following repayment vehicles will now be accepted from today:


  • If bonus is selected as a repayment vehicle, this will not be included in the affordability calculation.
  • A maximum of 30% of gross annual bonus for sole or 30% of combined gross annual bonuses for joint applicants.
  • Maximum age is the lower of anticipated retirement age or maximum working age, plus 11 months. This will allow for bonuses to be paid after retirement.
  • Minimum income levels apply **


  • Must have been held in a savings or current account for a minimum of three months.
  • A minimum of £50k is required (this can be held over several accounts).
  • Minimum income levels apply **

Scottish Widows Bank has also improved its existing pension repayment vehicle


  • Projected total fund value rather than current figures will be accepted. Projection must be a minimum of £400k of which15% will be used for interest-only i.e. minimum £60k.
  • For final salary pensions where no projected fund is provided, the tax free lump sum must be a minimum of £100k of which 60% will be used for interest-only.
  • Customers can use multiple pension funds, as long as each fund meets minimum requirements.
  • Maximum age is the lower of anticipated retirement age or maximum working age.
  • No minimum income levels apply.

The following details the Sale of Mortgage Property repayment vehicle (launched in June 2016):

  • Maximum LTV Sale of Mortgaged Property is 50% LTV. Other repayment vehicles can be used to take borrowing up to 75% LTV. 
  • Maximum age is the lower of anticipated retirement age or maximum working age.
  • There must be a minimum of £200k equity in the property.
  • Minimum income levels apply **

Sale of Mortgaged Property (2nd home)

  • Maximum LTV Sale of Mortgaged Property (2nd home) is 75% LTV.
  • No minimum equity required.
  • Minimum income levels apply ** 

For sale of other residential (unmortgaged) property, current property rules remain.

 **Eligible applicants will require a minimum income of £100,000 pa for sole applications. For joint applications, one must have a minimum income of £100,000 pa, or joint applicants must have a minimum combined income of £150,000 pa.

Bonus, cash and pension cannot be used for End of Term extensions, however sale of 2nd property still remains a valid repayment vehicle.

Scottish Widows bank will now consider projected income for doctors, dentists, solicitors and accountants, where they are moving from employed to self-employed or are within the first year of the new self-employed status.

For more information, speak to your Business Development Manager or call our Intermediary Support Team on 0345 845 0110.

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