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Wood89

Self build mortgage where to start

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After our first land plot didn't work out we have found another one we love offers of around 125k in aberdeenshire it already has full planning permission for 1.5 storey 4 bedroom detached dwellinghouse with garage the has mains drainage on site with mains electricity, water supply and phone line located nearby and easily connected...ideally we want to go to a timber frame company with the house designs to get a quote for the kit cost.

 

So my question is once we have a quote for that and we no how much the land is, we would need a quote from a builder for putting the kit up and making it water tight everything else we would do our self as we have lots of trades people in the family, how much of a mortgage do we estimate for? We have a pretty decent deposit but apparently with self builds it's always better to have lots of extra cash as things are never straight forward! P.s we are first time buyers/builders any input would be great thanks!

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I would work it the other way.  You know your income, what is the maximum you can borrow?  That less the plot price and service connections plus your savings is how much you have to spend on the build.

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59 minutes ago, Wood89 said:

After our first land plot didn't work out we have found another one we love offers of around 125k in aberdeenshire it already has full planning permission for 1.5 storey 4 bedroom detached dwellinghouse with garage the has mains drainage on site with mains electricity, water supply and phone line located nearby and easily connected...ideally we want to go to a timber frame company with the house designs to get a quote for the kit cost.

 

So my question is once we have a quote for that and we no how much the land is, we would need a quote from a builder for putting the kit up and making it water tight everything else we would do our self as we have lots of trades people in the family, how much of a mortgage do we estimate for? We have a pretty decent deposit but apparently with self builds it's always better to have lots of extra cash as things are never straight forward! P.s we are first time buyers/builders any input would be great thanks!

 

If you haven't already done so I would recommend opening a help to buy ISA. If your a first time buyer then you should be able to get a bonus when you make the purchase. Ideally you would have wanted to be saving a few years before to maximise the bonus.

 

Your in Aberdeenshire so your mortgage possibilities will be limited. Scottish Building Society, Ecology, Buildstore or Scottish Government self build loan scheme (borrow £175k for construction). All of these had different advantages and disadvantaged for us, but we decide on SBS,

 

I am also a first time self build and buyer. Just out of curiosity how did you decide on self building? 

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Read this thread. I linked a couple of long lists on there.

 

https://forum.buildhub.org.uk/topic/9921-self-build-mortgage/

 

At a Self Build event last month, Penrith BS told me that they allow you to borrow against land value ... will probably need PP in place ... and consider the whole country excl. Northern Ireland.

 

The devil is, however, in the detail. So homework to be done.

 

Ferdinand

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12 hours ago, Thedreamer said:

 

If you haven't already done so I would recommend opening a help to buy ISA. If your a first time buyer then you should be able to get a bonus when you make the purchase. Ideally you would have wanted to be saving a few years before to maximise the bonus.

 

Your in Aberdeenshire so your mortgage possibilities will be limited. Scottish Building Society, Ecology, Buildstore or Scottish Government self build loan scheme (borrow £175k for construction). All of these had different advantages and disadvantaged for us, but we decide on SBS,

 

I am also a first time self build and buyer. Just out of curiosity how did you decide on self building? 

Hanley also lend in Scotland though my experience was they'd only lend about 75% of what Ecology would to us. 

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Melton Building Society still do a Self Build Mortgage product at 75% Advance Mortgage

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12 hours ago, Thedreamer said:

 

If you haven't already done so I would recommend opening a help to buy ISA. If your a first time buyer then you should be able to get a bonus when you make the purchase. Ideally you would have wanted to be saving a few years before to maximise the bonus.

 

Your in Aberdeenshire so your mortgage possibilities will be limited. Scottish Building Society, Ecology, Buildstore or Scottish Government self build loan scheme (borrow £175k for construction). All of these had different advantages and disadvantaged for us, but we decide on SBS,

 

I am also a first time self build and buyer. Just out of curiosity how did you decide on self building? 

I have done some research into the help to buy ISA and I didn't think you could get the benefit of it if you were going for a self build mortgage 🤔

 

My parents self built 40 years ago and a few distant friends have also, we see how much other people are paying for a 4 bedroom box of a house with a tiny garden and no garage aberdeenshire prices in some places are crazy, with some decent savings and knowing the right people you can build your dream house in the location you want and when it comes to sell you normally have a pretty decent profit at the end..this would be our forever home and we are in the position of very little out goings and decent wages coming in every month 

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13 minutes ago, Wood89 said:

I have done some research into the help to buy ISA and I didn't think you could get the benefit of it if you were going for a self build mortgage 🤔

 

My parents self built 40 years ago and a few distant friends have also, we see how much other people are paying for a 4 bedroom box of a house with a tiny garden and no garage aberdeenshire prices in some places are crazy, with some decent savings and knowing the right people you can build your dream house in the location you want and when it comes to sell you normally have a pretty decent profit at the end..this would be our forever home and we are in the position of very little out goings and decent wages coming in every month 

 

 Similar to us. I'm 32 and it's been a ten year plan for us to date, including five years of living in the loft of my wife's parents.

 

I would look again at the help to buy isa. We didn't qualify because before the scheme was released we had already de-crofted agricultural land for our house site, so this counted as residential land. If you don't own the land you should qualify, but you will need time before to ensure you save enough to get the full bonus if opening the ISA now. The full bonus is £3,000!

 

I mentioned on a previous post last month that it would be unlikely for a self builder who did not already have access to land and had never owned property before to benefit from the scheme, I stand corrected!

Can I use a Help to Buy: ISA bonus to buy land to build my first property on?

Assuming that you meet all the other eligibility criteria, you will be able to use the government bonus towards the purchase of the land for a self-build property which is the only home you will own, be where you intend to live and be purchased with a mortgage. The land must be in the UK, have a price of £250,000 or less (with a higher price limit of £450,000 in London).

 

https://www.helptobuy.gov.uk/help-to-buy-isa/faq/

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6 minutes ago, selfbuildaberdeen said:

I had a 1st time buyers ISA and received the 25% government bonus to purchase the plot. 

 

Okay just seen that.

 

Double corrected!

 

Nice to see self builders benefiting from the bonus rather than those fat cat housing developers. 

 

Might be worth posting a topic about your experience with the scheme as it could be useful to others.

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1 minute ago, Thedreamer said:

 

Okay just seen that.

 

Double corrected!

 

Nice to see self builders benefiting from the bonus rather than those fat cat housing developers. 

 

Might be worth posting a topic about your experience with the scheme as it could be useful to others.

I can do that. Would certainly recommend it as no hassle at all to set up, deal with or claim 👍

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1 hour ago, eandg said:

Hanley also lend in Scotland though my experience was they'd only lend about 75% of what Ecology would to us. 

 

I did look at that one, but I think they had a clause about Islands, can't remember.

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2 minutes ago, Thedreamer said:

 

 Similar to us. I'm 32 and it's been a ten year plan for us to date, including five years of living in the loft of my wife's parents.

 

I would look again at the help to buy isa. We didn't qualify because before the scheme was released we had already de-crofted agricultural land for our house site, so this counted as residential land. If you don't own the land you should qualify, but you will need time before to ensure you save enough to get the full bonus if opening the ISA now. The full bonus is £3,000!

 

I mentioned on a previous post last month that it would be unlikely for a self builder who did not already have access to land and had never owned property before to benefit from the scheme, I stand corrected!

Can I use a Help to Buy: ISA bonus to buy land to build my first property on?

Assuming that you meet all the other eligibility criteria, you will be able to use the government bonus towards the purchase of the land for a self-build property which is the only home you will own, be where you intend to live and be purchased with a mortgage. The land must be in the UK, have a price of £250,000 or less (with a higher price limit of £450,000 in London).

 

https://www.helptobuy.gov.uk/help-to-buy-isa/faq/

I wish I had known this earlier 🤦‍♀️ I honestly thought it wasnt included for purchase of land/ self build will defo do some research now!

 

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1 minute ago, Wood89 said:

I wish I had known this earlier 🤦‍♀️ I honestly thought it wasnt included for purchase of land/ self build will defo do some research now!

 

I recommend it. Was really easy to deal with 👍

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6 minutes ago, Wood89 said:

I wish I had known this earlier 🤦‍♀️ I honestly thought it wasnt included for purchase of land/ self build will defo do some research now!

 

Lifetime ISA might be better (not checked if that includes land but think it replicates Help to Buy) as you can plank £4k in a year compared to £200 a month with Help to Buy.

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3 minutes ago, Wood89 said:

I wish I had known this earlier 🤦‍♀️ I honestly thought it wasnt included for purchase of land/ self build will defo do some research now!

 

 

I'm sorry, but don't beat yourself about it. Worth opening ASAP and then it's up to you how long you wish to save and wait.

 

Pretty much everybody on the forum has stuff like this.

 

So, so, so much to know. You really have to be a sponge.

 

And soak up as much information on the forum, read books like the home builder's bible and pretty much google every week for 'self build' to see if you find any new news about self building.

 

 

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Posted (edited)

Anyone with kids over 16 should consider opening a Help to Buy ISA for them even if you just put £1 in. That's because the scheme ends on 30th November 2019. You can continue to put money in after then and use it to buy a house until 2030.

 

You need to be over 18 to start a Lifetime ISA but it's 16 for Help to Buy ISA.

Edited by Temp
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Posted (edited)
5 minutes ago, Temp said:

Anyone with kids over 16 should consider opening a Help to Buy ISA for them even if you just put £1 in. That's because the scheme ends on 30th November 2019. You can continue to put money in after then and use it to buy a house until 

Edited by selfbuildaberdeen

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Posted (edited)
6 minutes ago, selfbuildaberdeen said:

With the help to buy isa you have to put in 200 quid a month tho or you dont get back any bonus

 

No that's wrong.

 

The _maximum_ you can save is £200 a month, except when you open it when you can put in a lump sum of £1200.

 

There is a minimum bonus of £400 so you must have saved £1,600 before you can claim.

There is a maximum bonus of £3,000 for which you need to have saved £12,000.

 

Details

https://www.helptobuy.gov.uk/help-to-buy-isa/how-does-it-work/

 

Martin Lewis urging people to consider a Help to Buy ISA..

https://www.thesun.co.uk/money/9227324/martin-lewis-first-time-buyers-help-buy-isa-now/

 

 

 

Edited by Temp

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The fastest way you can get a bonus is to pay in £1,200 then make 2 monthly payments of £200 making £1600 in total for which you get £400 bonus.  Total time about 3 months.

 

The slowest possible way would be to pay in just enough to reach £1,600 in 2030. If we say 2030 is about 120 months away it means the minimum you need to save is at least £14 a month (£14 * 120 = £1,680).

 

 

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So can anyone confirm this query if we get a help to buy ISA it's to help get a mortgage on the purchase of the land only or is it cost of land, kit, and construction? 

If it's just the land would we need another loan/mortgage for kit and construction 🤯

My head is a mush now 🤦‍♀️

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The ISA is deemed cash - just has to be used as part of a property transaction.

 

You will need a mortgage for the rest (dependent on savings etc) and that is where the fun will start....

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6 minutes ago, PeterW said:

The ISA is deemed cash - just has to be used as part of a property transaction.

 

You will need a mortgage for the rest (dependent on savings etc) and that is where the fun will start....

 

Perfect my brain has registered that information properly now confusion over 😁👍

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2 minutes ago, Wood89 said:

 

Perfect my brain has registered that information properly now confusion over 😁👍

Technically the cash is returned to a bank account of your choosing at closure and only the bonus has to be used in conveyancing. For the Lifetime ISA the bonus is added to the account at the end of the month when you made a deposit and the full sum needs to be used in the property transaction. 

 

I didn't realise I had to transfer my Help to Buy ISA over to the Lifetime one by, I think, January of the first year of the LISA so missed out on maybe a couple of grand worth of extra bonus which grates a bit. And currently have £2k sitting in a LISA from the top-up I made in the March and can't access. So not sure if my current self-build self is up or down but at least I should get a good weekend away at 60!

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4 hours ago, Wood89 said:

I have done some research into the help to buy ISA and I didn't think you could get the benefit of it if you were going for a self build mortgage 🤔

 

My parents self built 40 years ago and a few distant friends have also, we see how much other people are paying for a 4 bedroom box of a house with a tiny garden and no garage aberdeenshire prices in some places are crazy, with some decent savings and knowing the right people you can build your dream house in the location you want and when it comes to sell you normally have a pretty decent profit at the end..this would be our forever home and we are in the position of very little out goings and decent wages coming in every month 

We are in the same kind of position,

Aberdeenshire prices are coming back up and you pay a fortune for a box that is exactly the same as the rest of the street. We are also 1st time builders doing a kit house in aberdeenshire 👍 good luck with your project

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