As part of the Brexit transition, EU, EEA or Swiss citizens living in the UK before 31 December 2020 must apply to the EU Settlement Scheme to continue living in the UK after 30 June 2021.

To ensure we are supporting customers who were living in the UK before 31 December 2020, and in line with leading competitors, we are making a further update to simplify our foreign national policy.

From 1st January 2021, the treatment of customers with ‘Pre-Settled’ status will be aligned with customers who receive ‘Settled’ status.

What you need to know:

  • EU, EEA or Swiss citizens who apply to the EU Settlement Scheme will receive either ‘Settled’ or ‘Pre-Settled’ status
  • From 1st January 2021, customers who receive either ‘Settled’ or ‘Pre-Settled’ status will be subject to normal residential and buy to let policy and lending criteria
  • EU, EEA or Swiss citizens who lived in the UK before 31st December 2020 need to have received confirmation of their “Settlement Status” (Settled or Pre-Settled) before entering a mortgage application for new lending
  • Irish citizens, or customers already with indefinite leave to remain, do not need to apply under the EU Settlement Scheme and therefore will be subject to normal residential and buy to let policy and lending criteria

Pipeline Cases

  • Any applications for EU, EEA or Swiss nationals submitted prior to 1st January 2021 should follow the policy at time of applying and continue to treat these customers as having permanent right to reside.
  • Any applications submitted from 1st January 2021 should follow the new policy.

What you need to do:

  • Familiarize yourself the FAQs on our latest news page, so that you can ensure your customer meets our eligibility criteria when applying for a mortgage
  • Request evidence of the customer’s settlement status or indefinite leave to remain where required. This can be via a copy of their ‘Settled’/’Pre-Settled’ decision letter.
  • We will require you to include a copy of the customers ‘Settled/Pre Settled’ decision letter as part of their application packaging.

FAQs

‘Settled’ status is if the customer has lived in the UK for >5 years and can stay in the UK for as long as they like​. This is equivalent to Indefinite leave to remain.

‘Pre-Settled’ status is if the customer has lived in the UK for <5 years. The customer will be allowed to stay in the UK for 5 more years from the date they receive ‘Pre-Settled’ status. This is equivalent to Limited leave to remain. The customer can apply for ‘Settled’ status once they have 5 years continuous residence in the UK.

https://www.gov.uk/settled-status-eu-citizens-families

Unless there is another party on the mortgage who has permanent right to reside, EU settlement status, or is an Irish citizen, the customer will not be able to apply for a mortgage or any further lending until they have confirmation of their ‘Settled’ or ‘Pre-Settled’ status. This is because after 30th June 2021, a customer may lose their right to reside in the UK if they have not applied to remain in the UK under the scheme. According to current government guidelines they have until the 30th June 2021 to apply and it is taking up to 5 days for an application to the EU Settlement Scheme to be processed.

Anyone who enters the UK after 31st December 2020 and isn’t eligible for the EU Settlement Scheme will be subject to the UK’s new points-based immigration system and will need to apply for a visa. Our ability to lend to the customer will depend on whether the visa they obtain meets our Foreign National policy.

Any applications for EU, EEA or Swiss nationals submitted prior to 1st January 2021 should follow the policy at time of applying and continue to treat these customers as having permanent right to reside.

Any applications submitted from 1st January 2021 should follow the new policy.