Self build question

bclark

The opportunity has come up to possibly get a but of land with outline planning permission for a 4 bedroom house and I am sorely tempted to have a go at getting my dream house this way.

Obviously (to anyone that knows me) I won't actually be building the house myself but getting a builder to do it but my question is really about a self build mortgage.

Looking about the marketplace these seem to be quite a niche product and not offered by a lot of the bigger lenders. Where you can get them the rates seem to be a good deal higher than other mortgages, obviously because the risk is higher.

My question really is about whether it would work for me to get a self build mortgage on a two year term and then after the house is built and the term comes to an end I could re-mortgage with a mainstream lender? I can't see any reason why not as the house would be a normal house, I wouldn't be going for anything off Grand designs, but I just wanted to check that I wasn't missing anything?

kingstreet

Yes.

Once the property is completed and has the necessary certification, it should be possible to remortgage, subject to valuation, status and criteria.

bclark

Thanks Kingstreet, I hoped it would be that simple.

Crashandburn

Just make sure you have quite a bit if capital behind you. Most of them work on the basis of paying you in arrears for each stage completed whereas the 'good old days' had the payments in advance.

Will look out for it on Channel4

Good luck

bclark

I am thinking of going for one of those off site manufactured homes like a Huf Haus. They go up in rapid times so it would be interesting to see how that works with the staged release of money.

Still early days yet but yes I would have some capital behind me for cash flow.

kingstreet

If you are going for non-standard construction, I'd check the availability of mainstream mortgages on such construction before you proceed.

You may have the likes of Ecology Building Society, but you don't want to restrict the possible sources of lending for you and for any potential buyer too far, should you decide to sell at some point.

swanny65

Exactly what I did 10 years ago and re-mortgaged on completion. The best investment I made !

I could not afford a Huf Haus, but the Grand Designs episode I watched with the old designer couple who had one built was one of the best. If I did it again I would look to a Huf Haus or something similar.

I used Norwich and Peterborough for my initial mortgage and, as has been mentioned, had about £30000.00 "free / working" capital.

Good luck post a picture when completed.

bclark

swanny65 wrote: »

Exactly what I did 10 years ago and re-mortgaged on completion. The best investment I made !

I could not afford a Huf Haus, but the Grand Designs episode I watched with the old designer couple who had one built was one of the best. If I did it again I would look to a Huf Haus or something similar.

I used Norwich and Peterborough for my initial mortgage and, as has been mentioned, had about £30000.00 "free / working" capital.

Good luck post a picture when completed.

Without wanting to turn this into a self build forum what route did you go down? Did you do a traditional brick build? Do it yourself etc?

Thrugelmir

bclark wrote: »

I am thinking of going for one of those off site manufactured homes like a Huf Haus. They go up in rapid times so it would be interesting to see how that works with the staged release of money.

Still early days yet but yes I would have some capital behind me for cash flow.

You'll need to fund around 25% of the total cost ( land plus build) plus have a contingency of around 10% for the unexpected extras.

jennifernil

Take a look at BuildStore, they offer self build mortgages.

I don't see timber frame as a problem necessarily. We designed and built our house 25 years ago, have had it mortgaged with Halifax (twice) , Abbey and Nationwide over the years. I would advise against timber cladding though.