ASK THE EXPERT


Unlocking fi nance for your dream home


BuildStore Mortgage Services’ Tom McSherry tells The Selfbuilder’s James Parker how self-build mortgages work, the options available, and why early fi nancial


planning is key to a successful project.


WHAT ARE THE DIFFERENT TYPES OF SELF-BUILD MORTGAGES ON OFFER, AND HOW DO THEY DIFFER FROM CONVENTIONAL MORTGAGES? A self-build mortgage is designed to release funds in stages, rather than as one lump sum at the start, to match the way building projects incur costs. There are two main types: Arrears Valuation Stage Payments Funds are released after each stage of work is completed and signed off by a valuer. This suits borrowers who have signifi cant savings and already own the site. It is important to understand that if the value does not increase in line with the spend, you could incur cash fl ow issues.


The other is Arrears Stage Payments Guaranteed. Unlike the valuation based arrears products, these mortgages guarantee you the funds after each stage of the project, reducing risk and creating the certainty of you receiving the funds you need.


Advance Stage Payments Guaranteed unds are released at the start of each stage, based on your build costs, not the value of the property at that point. This provides certainty and better cash fl ow, particularly for those without


8


large savings or looking to use offsite manufactured building systems. This differs from a conventional mortgage, where funds are released in full at completion of the purchase. Self-build mortgages are tailored to the uniue cashfl ow demands of building a home from scratch or undertaking major works.


WHAT ARE GUARANTEED STAGE PAYMENTS, AND HOW DO THEY WORK?


Guaranteed stage payments, available through BuildStore’s exclusive arrears and advance payment products, mean your funds are released on pre-agreed dates and amounts, aligned with your build schedule. This is based on your project’s


estimated costs, rather than the value of the property at each stage. The benefi ts are signifi cant • Cashfl ow certainty – you know exactly when and how much money will be available.


• educed reliance on savings – ideal for those without large sums to cover upfront costs.


• Fewer delays – contractors can be paid promptly, avoiding costly stoppages.


WHAT CRITERIA DO SELF-BUILDERS NEED TO MEET TO QUALIFY FOR A SELF- BUILD MORTGAGE? While requirements vary by lender, common criteria include: • eposit – usually at least  of the total project cost; however, BuildStore has products with as little as a  deposit reuired.


• etailed plans and budget – lenders want to see accurate costings and a realistic schedule.


• lanning permission – outline planning consent is typically needed before funds are released to purchase the land, with detailed planning required to release funds to start the build.


• ood credit profi le – similar to a conventional mortgage, affordability and credit checks apply.


WHY IS IT SO IMPORTANT TO SPEAK WITH A MORTGAGE SPECIALIST EARLY ON IN THE PROCESS?


Engaging with a specialist like BuildStore early ensures you: • Choose the right product for your cashfl ow and proect type.


• Understand your budget before committing to land or build costs.


• Avoid funding gaps that can halt progress mid-project.


• Navigate lender requirements so your application proceeds smoothly. Many self-builders waste time and money because they seek fi nance too late. Early advice can help shape your project to meet lender criteria from the start.


CAN I USE THIS TYPE OF FINANCING FOR A REFURBISHMENT PROJECT OR EXTENSION? es. While selfbuild fi nance is often associated with building from scratch, it can also fund: • Major renovations • Buying an uninhabitable property for renovation


• Barn conversions • roperty reconfi gurations


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52