Got a mortgage but its not easy!

RuskyJ

Good news! Well - sort of! We have been approved for our FTB motgage, the company (A&L) just need to value the house now and that going well we will get our money!! One downside was that we had to add another £4,000 to our deposit as we are going for a new build and the max LTV offered by A&L for new builds is 80% - is this normal? Thankfully, we have the money so thats ok and we are happy to pay up to get the mortgage but its so frustrating!! Any thoughts on this?

luckyfool

Many lenders restrict new build houses to 75%, and flats to 60% or even do not lend on new build flats at all. This is perfectly common in the current market. You are also seeing changing definitions of "new build". Whereas in the past it was any "new" property where you would be the first occupant, now many lenders treat any property first occupied less than 2 yrs (or even longer in some cases) ago as new build, and apply their criteria accordingly.

dunstonh

One downside was that we had to add another £4,000 to our deposit as we are going for a new build and the max LTV offered by A&L for new builds is 80% - is this normal?

It is at the moment. New builds typically lose up-to 15% of their sale value the minute you walk through that door. In a rising market, its not so much of a problem but in a falling market, it can be. Even with you moving to 80%, chances are you are going to find yourself in negative equity within 6 months. Hence why lenders want bigger deposits on new builds.