LISA and self build mortgage

[EdHat]

Hi all,

 

Been visiting this forum for some time and was hoping some of you may be able to give some advise for my situation.

 

My wife and I are hoping to build a house in my parents garden.

I have got planning permission already (although am about to resubmit).

 

We have been saving into LISAs but before we put another £16k in in March & April I want to make sure we can get the bonus

 

We intend to purchase the land from my parents with what we have saved in the LISAs rather then for the full value of the land, just so that we can get the 25% bonus. I understand you can use the LISA and get the bonus when buying land to build a house, but you need a mortgage.

 

Is it possible to secure a self build mortgage to buy the land, so we get the LISA bonus, but then don't borrow any money at that stage?

 

If we are buying the land for say £40k when it is worth £280K how does that affect things?

I'm hoping to use the equity we then have in the land to secure further stage payments.

 

Thanks in advance for any advise given, even if it's just who I should be speaking to for advise on this, mortgage provider or conveyancing solicitor?

[ToughButterCup]

15 hours ago, EdHat said:

....

Is it possible to secure a self build mortgage to buy the land, so we get the LISA bonus, but then don't borrow any money at that stage?

...

 

Can I suggest you ask the provider of the relevant product. Or perhaps, one of their agents? 

[Adrian Walker]

I presume this is for your first house? You need to check the rules about buying land. 

[PNAmble]

we didn't have a LISA but we used Mayflower mortgage brokers who specialise in Self Build to organise our Self Build Mortgage and they were extremely helpful before we even took out a mortgage.   We bought our Land with Cash and are using the mortgage for the build.  the first drawdown was on on a % of the land value.  

[Blooda]

Welcome.

 

You need to speak to someone who knows the full in's and out's, and can advise properly -  not just listen to someone like me on a random internet forum  but:-

 

There are many factors here both for you and your parents including:-

 

Quote

If we are buying the land for say £40k when it is worth £280K how does that affect things?

This may be construed as 'a disposal at undervalue'  and thus it would affect any capital gains.

 

Depending on the size of the bonus, it may cost you more to obtain it than the bonus is worth.  

 

 

[Mr Punter]

Mortgage broker specialising in self build mortgage may be best to advise.  I don't think there is anything wrong with getting the land below market value.  You will need a mortgage to qualify for the bonus.

[Amateur bob]

On 13/11/2023 at 14:05, PNAmble said:

we didn't have a LISA but we used Mayflower mortgage brokers who specialise in Self Build to organise our Self Build Mortgage and they were extremely helpful before we even took out a mortgage.   We bought our Land with Cash and are using the mortgage for the build.  the first drawdown was on on a % of the land value.  

what lender did mayflower but u in touch with?