BuildLoan has launched a new range of products with Newcastle Building Society offering self and custom builders up to 90% of their land and build costs.
The firm suggested this move would significantly reduce the cash a client would need to put into their build.
BuildLoan’s new products can provide up to 90% of the project costs for loans up to £500,000. For larger mortgages, up to 85% of build costs are available for loans to £750,000 and 80% of costs for loans up to £1m.
The mortgage distributor’s head of product development and underwriting, Chris Martin, said the products have been created to make “designing and building your own home more accessible”, for people who have a smaller amount of cash of their own to put into their project.
“In the past, clients would need around 20% of their land and build costs in cash as well as funds to cover planning and architects’ costs – which we believe average around £30,000,” Martin commented.
“These new products make building your own home a genuine option even for those with not much more than 10% of their total costs, particularly if they choose a custom build site where much of the planning and design fees are taken care of by the developer.
“We know that not having cash when they need it during the build is one of the biggest worries for self-builders. So, all of our products have the unique promise of guaranteed funds at each stage of the build, with no valuations while the house is being built.”
Newcastle Building Society head of intermediary mortgages, Franco di Pietro, added: “We’re always looking for innovative ways to support the needs of clients, especially in areas of the market which are traditionally underserved.
“We know one of the barriers to self-build is having sufficient cash to cover land and build costs on top of planning and architects’ fees. So, we’ve worked closely with BuildLoan to create a range of products which make designing and building your own home more accessible.
“As well as offering loans up to £1m as standard and up to 90% of the value of the completed property, the range includes fee-free and ERC-free options, giving brokers and their clients even more choice.”
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