Mortgage and Insurance Advisers


Are New Homes Mortgages Any Different?


Are New Homes Mortgages Any Different?

With new build properties popping up left right and centre across the UK, there is an increased demand for new homes mortgages, leaving many potential homeowners with the question, are new homes mortgages any different? And if so, how? 

At Weystone Financial, we are experts when it comes to new homes mortgages and we understand the expectations both lenders and developers have with new build properties. If you are familiar with the standard homeowner’s loan and would like to learn more about new homes mortgages, allow us to guide you through their differences and what you should expect as a potential new build property owner. 

Difference in Deposit

Recently, some mortgage lenders have started offering 95% mortgages for first-time buyers, reducing the amount needed for a deposit and allowing them to purchase a property much sooner. However, this is often not the case for new build properties. 

Because many lenders view new builds as a risk, they require higher deposits to secure a mortgage. Most lenders will offer 85% maximum, with some only offering up to 75% for new-build flats. So, if you are planning to purchase a new build, chances are you’ll need to save more for the deposit. However, there are government schemes that help with this, so keep an eye out for those. 

Securing a Mortgage Off-Plan

Unlike older homes, you can actually secure a new homes mortgage for an incomplete new build property. If you’re set on a particular house, but the developers haven’t completed construction yet, you can still apply for and successfully secure a mortgage, also referred to as buying off-plan. 

You can even buy off-plan before construction has commenced, giving you more say in the design and build of your new home. However, it is more difficult to secure a mortgage for incomplete new builds. Not only do lenders see these properties as a bigger risk, but most mortgage offers expire within 6-months. If your property isn’t complete within this time, you’ll either have to apply for an extension or for a new mortgage deal entirely. 

Government Schemes

However, it’s not all doom and gloom when it comes to new homes mortgages, in fact, there are plenty of government schemes out there dedicated to helping you secure your dream home. This includes: 

  • Help to Buy Equity Loan
  • London Help to Buy Equity Loan
  • Help to Buy Scotland
  • Help to Buy Wales
  • First Homes 

More and more lenders are working alongside these schemes to help you secure a new homes mortgage. For more information on these schemes and how they can help you, please get in touch with us at Weystone Financial. 

Difference in Choice

Unfortunately, as new build properties are a relatively new introduction to the UK housing market, many lenders are still reluctant to offer new homes mortgages. This means you’ll likely have less choice when it comes to mortgage deals than you would when purchasing an older property. However, with the help of an expert mortgage advisor, we guarantee you can secure the right new homes mortgage deal for your situation. 

Don’t tackle the property market on your own, get in touch with Weystone Financial instead and let us help you secure your dream new build. 

Leave feedback about this

  • Rating