Self Build Mortgages

Looking for the ideal home for you and your family, in the perfect location, and at the right price is usually a prolonged and distressing venture.

For many, having the ability to build your own home is the dream. This way you can customise it to your immediate and future needs rather than having to continuously remodel it over the years.

For those of you who choose to venture down the self-build path of owning a property, then you probably will need a self-build mortgage to fund your self-build home.

When opting to take self-build route, there are typically three approaches to accomplish this goal, or a blend of all three.

Option 1

You could decide to do it all yourself, specifically if you have some building and construction experience, and hire trades people during this process whenever it is required.

Option 2

You could alternatively merely manage the project and employ an architect, surveyor, and construction company, who are going to work for you to build your home.

Option 3

If you prefer to be entirely hands-off, you could appoint a contractor to manage the project, and hire the appropriate laborers to execute the project, from start to finish. However this approach is likely to end up being more expensive.

Self-build mortgages as the name suggests are mortgages that fund your self-build project.

Self-build mortgages allow you to borrow cash to initially purchase the land (where applicable), then the funds are released in stages so you're able to pay for the build as it advances as opposed to a single lump sum at the beginning. Generally, you'll receive additional funds as soon as the foundations have been laid, and again when your home has been built up to the stage where the roof has to be installed.

Further payments are available when the roof has been erected and sealed, when the internal walls are plastered, and finally when the whole house has been completed.

You will need to have a minimum 30% deposit to contribute towards the total cost of the project. (You may be able to raise funds on the land if already owned / being gifted to help towards this.)

As part of your application, you need to supply a plan of how you intend to build your property. This must be made in a way that provides a sense of how the project will be managed and demonstrate a process that we can have confidence in to release funding.

At each phase of build a self-build mortgage payment is sent to you, and a property valuer will normally visit the building site to confirm the work has been completed satisfactorily and is on course with the project plan.

The build will need to be supervised throughout either by a qualified Architect or Building warranty firm and at each stage release, they will need to provide confirmation of the work undertaken.

All funds must be drawn down within 3 years from the date of the mortgage offer.