Self-Build and Custom-Build

Available for properties in Scotland and the North of England.

Properties may be constructed by either: A single build on a fixed price contract, or on an all trades basis under direction of a suitably qualified project manager.

We’ll ultimately lend up to 80% of the build cost or final property valuation (whichever is lower) with a maximum of 60% for the initial release based on the land alone. The value of the land, if already owned and debt free, may be included in the borrower's contribution.

Minimum mortgage term is 5 years and maximum term is 40 years.

Applicants must be at least 18 years old and normally not more than 85 at the end of the mortgage term.

All mortgage applications are based on affordability.

• For loans less than 80% of the property valuation or purchase price (whichever is lower) we’ll lend up to:
  
  Single applicant: 4.5 x income
  
  Joint applicants: Main income x 4.5 plus second income x 1 OR Joint income x 4
  
  
• For loans over 80% of the property valuation or purchase price (whichever is lower) we’ll lend up to:
  
  Single applicant: 4 x income
  
  Joint applicants: Main income x 4 plus second income x 1 OR Joint income x 3.75

As a responsible lender, we think carefully about the amount you can borrow and the mortgage terms that will work best for you.

We will carry out an assessment of your net income and outgoings to make sure the mortgage is affordable. Any existing financial commitments will also be taken into consideration when we calculate affordability.

The first instalment can be made available when you purchase the land and can be up to 60% of the plot value or purchase price – whichever is lower.
You then have the flexibility to negotiate instalments during the construction period, providing the outstanding loan is not more than 80% of the current valuation or build costs to date, whichever the lower.

Funds are released in stages after each section of work is complete.
The list below is a typical example of how this might happen but we can be flexible, depending on the type of build and your circumstances:

• Purchase of land (when full planning permission is in place)
• Foundations laid
• Up to eaves level
• Wind and watertight and roof tiled
• Interior walls complete (plastered out)
• Ready to move in

Each tranche of funds is released when confirmation is received from our Valuer that the stage has been completed to a satisfactory standard. If the construction is being supervised by an architect then they will also have to issue an interim certificate. The architect will need to confirm the build is on track to complete within the agreed build cost.

The property build must be carried out by a builder registered with the National House Building Council (NHBC). Alternatively, the build must be covered by NHBC Solo or you must employ an architect or RICS qualified surveyor with professional indemnity insurance to supervise the build. You can speak to one of our experienced Mortgage Advisers for full details.

When the build is complete and on production of the Completion Certificate we’ll allow a switch to a standard residential product available at that time. The early repayment charge will not apply.

The new product may have early repayment conditions. Where Early Repayment Charges apply to any of our mortgages you may be allowed to make overpayments (normally up to 10% of the loan amount per annum) without penalty.

Check our current interest rates

• Capital and Interest
• Interest only - available up to 75% of the property value. When you apply, we’ll need confirmation that you have plans in place to pay off your mortgage at the end of the term and we'll ask you about your plans occasionally while you have a mortgage with us. Examples of these plans are normally endowment policies; stocks and shares ISAs; pension lump sums; and second/investment properties.

A Standard Security will be taken over the property as security for the mortgage borrowing. 

If you make overpayments of 10% or more of the loan amount in any 12 month rolling period during the initial period, and depending on which mortgage you have, the charges apply as follows:

• For our 3-year mortgage, you will need to pay a charge equivalent to 3% of the outstanding balance amount in year 1 and 2 and 2% in year 3.

After the initial period, the Society will not make an early repayment charge if you move to Standard Variable Rate and choose to repay the mortgage. However, there will be certain redemption fees that will need to be paid (see our Details of Charges leaflet for more information).

It’s essential you get specialist self-build insurance if you intend to build a new home, or renovate or convert a property intended for occupation on completion and we’ll need evidence of the insurance before releasing funds