Nottingham Building Society has started accepting a wider range of income sources in its affordability assessments making it easier for more borrowers to qualify for lending.
The lender now recognises agency and zero-hours contract work, certain state benefits and drawdown pension income.
Nottingham will now accept income from agency and zero-hours contract work where borrowers have been in the same role for at least 12 months, such as nurses and supply teachers.
It will also accept state benefit income alongside employed, self-employed or retirement income, including Universal Credit, Personal Independence Payment and Disability Living Allowance.
Furthermore, the lender will recognise drawdown pension income from defined contribution schemes for borrowers who have already started receiving payments.
The changes apply across its standard residential, foreign national and returning expat and retirement interest-only mortgage ranges.
Nottingham says the changes are part of an ongoing drive to improve affordability assessments and support borrowers whose income does not fit a traditional fixed-salary model.
Previous enhancements since the start of the year, include recognising confirmed pay rises and new higher income from new roles and simplifying affordability tests for self-employed applicants.
The lender also increased the maximum loan-to-value on new-build flats to 85% and removed the LTV cap on lending into retirement.
Nottingham Building Society sales director Matt Kingston says: “Too many borrowers still find themselves treated as edge cases, even when they have a clear track record of earning and managing their money responsibly.
“These changes are about recognising that real life doesn’t always present as a single fixed salary. If someone is doing the work, building income and demonstrating resilience, our role is to assess that properly. That’s what good underwriting is for.
“We remain focused on widening access in practical ways, supporting brokers with the clarity and flexibility they need, while maintaining responsible lending standards.”
