BuildLoan launches low-fee self-build products

The products offer customers BuildLoan’s guaranteed stage payments during the build, linked to the cost of each stage of work. 

The two-year discounted products offer an early repayment charge (ERC) free option with an initial rate of 4.5 per cent or a two-year ERC option with a lower initial rate of 3.99 per cent.   

Both products have an application fee of £199 and a completion fee of £800 coming to a total of £999. 

Funds would be released in stages as the build progressed, with the frequency of releases agreed at application. This was expected to give borrowers the reassurance that contractors could be paid and materials purchased as the project progressed.  

Chris Martin, head of product development and underwriting at BuildLoan said: “We know that self-builders incur a lot of costs before they’ve even started their project and these products offer an option to reduce the fees for setting up the finance for their build but still getting the huge benefit of the guaranteed stage payments our products offer.    

“Building a new home can be very challenging and knowing exactly what mortgage funds will be received during the build takes away one of the big worries experienced by self-builders.” 

Carolyn Thornley-Yates, head of mortgage proposition and distribution at Hinckley and Rugby Building Society added: “We are committed to helping self-builders create their own homes by designing products with the right features.  

“By reducing the cost of setting up the mortgage but keeping the features that give borrowers the peace of mind to progress their build with confidence, we are making the option of self-build much more attractive.”