When you are looking for a new build lender for your clients, which features of their proposition are really important?
Great products and service are a good start, but intermediaries have told us time and time again that reliability and flexibility are essential too.
That’s because new build mortgages and purchases are not only different from mainstream deals, they are also far less predictable, and all parties need to be able to adapt to tight or changing timescales.
In practice that means you want to deal with lenders that can work quickly when necessary, allow for delays when they inevitably happen and be unfazed by whatever else the new build purchase process throws at them.
Mortgages now
New build lending can involve extremely tight deadlines and turnarounds that require the lender to have sufficient resources and tight processes in place to achieve them.
Turnaround times cannot slip simply because volumes have increased or staff are away, for example. If the developer states the plot is only reserved for 28 days then the purchase needs to be exchanged by then. The pressure is on everyone from lender to solicitor.
If those timescales sound impossible, remember that some elements of the conveyancing, such as title deeds and searches, will be already prepared by the developer’s conveyancers and won’t need repeating for every single property sold on a site.
Even so, the deadlines can be strict.
Not all lenders are adequately resourced to cope with a rush of business on tight deadlines, but new build specialists, such as Halifax Intermediaries, can manage high volumes of intermediary business without compromising service or speed.
That’s partly down to size, of course, but it’s also because of years of experience in the new build sector and technology that streamlines the process.
Mortgages later
At the other end of the scale you need a lender that understands the unpredictability of new build property purchase.
That’s because with part-finished or off-plan properties, you may have the opposite problem to a tight deadline – a long wait.
Delays to the completion of the property, due to bad weather for example, can mean that the mortgage offer has run out before your client can complete.
As an intermediary that’s really frustrating.
You want to be sure your client is getting the deal and rate they wanted, but if it expires you have the headache of needing to source and apply for a whole new mortgage.
Intermediaries want certainty, but builds don’t always run to schedule.
That’s why Halifax Intermediaries offers extended product end dates to counter the problem.
It might sound like a technical issue – and it is – but it can be invaluable for intermediaries and your new build clients.
The Halifax Intermediaries core new build range has extended end dates for three months longer than its standard products (usually at least nine months), meaning intermediaries have the confidence that the mortgage offer is less likely to expire.
Trusted experts
Finally, intermediaries have told us that on new build cases you want reassurance that, whatever your questions, the lender will have dealt with it before and have an answer.
Established new build lenders have access to a wide range of expertise, both on the phonelines and in the field.
And because they process this type of lending at volume, day in day out, their finger is on the pulse of the sector, and they’ve seen it all.
Always get in touch with the lender if you are not sure about any aspect of the mortgage or process.
Your business development manager is a good place to start, as well as intermediary helpdesks and webchat services.
Ultimately, new build is a specialist mortgage sector, so choosing a lender that’s experienced in it will afford you and your client the reassurance that, no matter what happens, you’re in good hands.
If the build gets delayed, the developer sets a tight deadline, or the property is built using modern methods of construction, you’ll have access to a professional that knows exactly what to do next and how to get that deal over the line.
[Sponsored content]
For the use of mortgage Intermediaries and other professionals only
If you do not have professional experience, you should not rely on the information contained in this communication. If you are a professional and you reproduce any part of the information contained in this communication, to be used with or to advise retail clients, you must ensure it conforms to the Financial Conduct Authority’s advising and selling rules. Halifax is a division of Bank of Scotland plc. Registered in Scotland No. SC327000.
Registered Office: The Mound, Edinburgh EH1 1YZ. Bank of Scotland plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 169628. This information is correct as of November 2019 and is relevant to Halifax products and services only.
