self-build mortgages

In most cases, your deposit needs to be at least 25% of the total project value.

You may be eligible for the government’s Help to Build scheme which can be used towards putting down a deposit. To use this scheme, you will need as little as a 5% deposit with the government providing a loan to top up the total deposit amount to 25%.

How much you can borrow depends on the lender’s lending criteria and on the borrower’s personal circumstances. Generally speaking, the amount you will be eligible to borrow is between 60% to 80% Loan to Value (LTV).

We will scan various offers and find the best option for you.

The advantages of a self-build mortgage:

• Save money on Stamp Duty. You only have to pay duty on the value of the land itself and only then if the cost exceeds £125,000.
• Cheaper than buying a ready-made home.
• You can build your dream home and make it how you want it.
• Higher profit margins once the build is complete. You will often find that the value of the finished property is significantly higher than the cost of the land, the materials, and the labour put together.

The disadvantages of a self-build mortgage:

• Higher interest rates than conventional mortgages.
• Requires a higher deposit of at least 25% of the total project value.
• Time-consuming project – you will need to source architects, builders, and materials and provide lenders with the necessary documents at each stage of the construction process.

There is a limited number of providers offering this type of mortgage. These mortgages come with higher interest rates and require a larger deposit than conventional mortgages. However, the Help to Build scheme can help you reach the deposit required.

Worry not. Our team of mortgage advisers will help you secure the self-build mortgage you need.

When planned well, self-build properties tend to have a much higher value than the labour, materials and other costs involved.

You will be able to remortgage once your self-build is complete and certified by a surveyor. Before you apply for a new mortgage, make sure there are no early repayment charges for leaving your existing deal.

You can start the remortgaging process once your property is habitable.

Have your property valued and apply for a new residential mortgage. You will likely be given a more affordable interest rate.

We can assist you in making a new mortgage application and help you find the best deals available.

The arrangement fees will vary depending on the broker or lender. It is vital to ensure you have sufficient funds available at the right time.

Yes, you can. The deposit will be higher. Most lenders will require a deposit of 50% for the purchase of land.

Yes, you can.  If you already own the land, you can still take out a self-build mortgage.

Bear in mind, that you may have to pay some stamp duty if the property you planning to build will not replace your main residence.

If you already own a property with equity in it, you may be able to remortgage or take out a bridging loan to pay for your new self-build project. You may need to sell your existing property once the self-build is complete to pay off the loan.

Bridging loans are short-term borrowing and come with high costs so it’s important to have an exit strategy in place should anything go wrong. Look for a bridging loan with a maximum term of 12 months. We can help you with that.

This is very likely. A bank or building society may not release initial funds until you can demonstrate that you have a 10-year structural warranty policy in place. You should also consider taking out a self-build and renovation insurance policy as a backup if anything goes wrong.