Self funding self build mortgage?

billymadbiker

Hi,
Does anybody know of a lender that would look at this:

Barn with full planning for conversion
1/3 of the barn has already been converted to a holiday cottage so has all services, 2 bedrooms etc.
The holiday cottage is included in the planning permission for full residential use.

I would like to buy with a 25% deposit and move into the completed part and do the rest of the own work myself and fund the build over 5 years or so from my own income.

I am only looking for the funding for 75% of the initial purchase price and would not be looking to draw down further funds afterwards.
I have been looking but I can't find a lender for residential as they dont think enough has been converted and all the self build lenders seem to want to see that I already have funds to do the conversion and not account for the fact that it's already a 2 bed house that's perfectly habitable.
Thanks!

tommyedinburgh

We are looking to self-build but can't secure a plot, it's making us lose the plot.

This sounds an interesting project. Firstly, good luck, secondly, would love to follow this thread.

billymadbiker

A full self build looks like it's easier to finance than this one!

From what I can work out if you could find a plot with planning permission you would need a 50% deposit for the plot and 50% of the funds to get the best rates.
You can get upto 85% finance on the plot (at a worse rate) and then they will lend you another installment after you have done some work and had a revaluation.

Mine seems to be a bit trickier as I only have the 25% deposit but I was hoping the fact that it is actually already a house that I can live in would count for something. After paying the deposit I dont really have any funds left to do much of the work but I do have a decent income and could fund the rest of the work myself over 5 years or so.

I did think about using a self build lender and just never calling down the extra funds but it looks like they will still want me to apply for a full mortgage for the land and the costs of completing the project and my income does not support borrowing that amount.

[Deleted User]

would you be better looking at renovation mortgages rather than self build?

https://www.buildstore.co.uk/mortgages-finance/project-types/renovation-and-conversion-mortgages

billymadbiker

I have had a look at build store and I will give them a ring tomorrow and have a chat.
Just looking at the website though it looks like the same sort of thing with stage payments made after you have done some of the work.

I dont know if they will accept that I will be doing the work as I can afford it and have time to do it or, like a self build, will want to see funds up front to do the conversion or income to borrow it.

billymadbiker

I dont seem to be getting anywhere with this.
Self build lenders want me to have the deposit for the property (which I do) but also 100% of the funds to do the full conversion.
Or enough income to borrow the funds for the conversion on top of the purchase. (Whjch I don't)

I thought it would be easy enough to just mort8it as a 2 bedroom cottage with outbuildings but that does not seem to be the case?

[Deleted User]

What normal lenders have you tried? If its habitable and you've got a 75% deposit i'm surprised you are not able to mortgage it normally

billymadbiker

I think the issue is that it has planning.
If it did not have planning I might stand more chance.
I tried a broker who could not place it for residential and tried buildstore who need me to be able to fund the full conversion cost upfront.

billymadbiker

Well, still no luck with this one!
Open to ideas if anybody knows of a lender worth trying?

trex227

I assume the planning is adding quite a bit to the value? How much more is it worth than a 2 bed without the possibility of extending?

billymadbiker

The planning is adding a lot to the value if the site, at a guess a barn, small holiday cottage and outbuildings would be £100k with no planning.

As it stands I think the sale price is about right, it's in a village in the middle of nowhere so not many sales to compare against.

Last 2 bed semi-detached sold for £35k less.
2 bed bungalow probably twice the total area of the holiday cottage part with a big garden is currently listed for £25k more than this one.