Bank statements no longer automatically required for owner occupied mortgage applications

Now, bank statements will only be requested for specific reasons by the underwriters; the automated requirement for them has been removed from our systems.

Bank statements may be required if:

• The credit file is ‘thin’ so additional data is required
• To verify any insurances, child care or school fees that have not already been declared
• To quantify regular payments which take a case beyond the affordability threshold to ascertain if they have already been included elsewhere.

Intermediaries are permitted to submit bank statements if absolutely necessary, for example to validate income or for proof of residence, however other alternative verifications are preferred in the first instance. You can view our list of preferred verification types here. Where a bank statement is necessary as proof of residence, we will only ask for the relevant page.

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Head of Underwriting Sandra Robson Clark comments, “By adopting a risk-based approach to our residential underwriting, we can reduce the need for underwriters to request bank statements where these will not add any value to the application.

“We know that obtaining, uploading and reviewing bank statements can contribute to delays in application processing times, and it is our priority that we minimise the obstacles to getting cases assessed in good time.”

For new cases:

• Our portal and underwriting software are in the process of being updated so that bank statements are not automatically requested.

For pipeline cases:

• If bank statements were automatically requested but are not required, the checklist item will now be removed.
• If you have already uploaded the bank statements and bank statements are now not required, we will delete them and let you know that these have not been reviewed/assessed.
• If a manual request was previously made for bank statements which are now not required, the underwriter will let you know that these have been deleted and not been reviewed/assessed.
• If a manual request was previously made for bank statements which are still required, the checklist item will remain.

Due to extremely high call volumes, we urge intermediaries to access the checklist for their case via the portal in the first instance if they believe that bank statements may no longer be required.

This simplification to required supporting evidence is part of a raft of changes being brought in by Foundation Home Loans, as part of their aim to simplify the underwriting process; recently, Foundation removed the need for Limited Company Funding Declarations on Limited Company mortgage applications.