The mutual confirmed income can’t be used where an applicant doesn’t have a firm return to work date, or their return to work date is after 2 November 2020.

It applies to all applicants regardless of if they apply direct through Nationwide or through a broker and comes in response to the closure of the government’s furlough support scheme.

Crucially, the change applies to all cases that have a first decision in principle (DIP) on or after 13 August.

However, this will also apply to pipeline borrowers who received a DIP before 13 August and suffer a negative change in income, such as job loss or reduction in income.

Further, it will also apply to cases where an offer extension is requested, and negative income changes have been declared.

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Return to work criteria

Where the applicant will be fully returning to work no later than 2 November and has a firm return to work (RTW) date, Nationwide will use up to 100% of basic income, including income that is currently treated as basic.

An exception applies for furloughed applicants on or those about to go on parental leave.

A RTW letter from the employer confirming the firm date the applicant will be fully returning to work is required.

This must be supported by either:

• confirmation the applicant’s terms and conditions of employment will remain unchanged as at 2 November 2020;
• or full details of where there will be a variation in the employment contract.

A Nationwide spokesperson, said: “As the government’s Coronavirus Job Retention Scheme comes to a close at the end of October we must ensure, as a responsible lender, that members can afford their mortgage payments both now and in the future.

“That is why we are asking all mortgage applicants from 13 August to provide a letter from their employer outlining a firm return to work date. Once that has been confirmed, we’ll take up to 100% of an applicant’s basic income into consideration.”