Swindon      01793 524444
Gloucester 01452 260729

Your Local Independent Specialist Insurance, Mortgage and Commercial Finance Advisors

Self Build Mortgages

Self build mortgages and financefor this type of property development is not as straightforward as that for a standard house purchase. Some lenders allow you to remortgage your own home to raise capital in parallel with a self-build mortgage. If it is not possible to remortgage and the self-builder has insufficient capital from other sources, then short-term bridging loan finance may be the only other option.

Building your own home became increasingly popular with high property prices making it harder than ever to get ahead in the property market. A self-build mortgage is exactly what it says, a home loan you take out to finance building your own house. When you take out a self-build loan the money is released in instalments, with an initial loan to buy the land.  

Every self-build project has identifiable stages from the initial digging of the foundations to the final fix and at each stage the value of the build increases. Payments are then made at different stages of building the property. The traditional type of self-build mortgage is on an ‘arrears’ basis.   

How much you can borrow depends on the mortgage provide. But typically up to 85% of purchase price and up to 85% of build costs, for traditional building plots and new self-builds, or demolition and rebuild, or full renovation projects. Generally speaking, because these are such niche mortgages, lenders tend to charge higher rates than normal.  

This may all seem very complex but don't worry for more information call us today and speak to our expert mortgage advisor who knows all the processes involved and can help you through each step. For most people getting their finances in order is an important starting point for their self-build project to ensuring the success of the project.

A mortgage for a self-build differs from a mortgage you would use to buy a house. This is why it is important to speak to a self-build finance expert to discuss your options as early in your project as possible.

For more specific help and to talk through you options, call our team of expert advisers today