The two products offer BuildLoan's guaranteed stage payments during the build, linked to the cost of each stage of work without the usual indemnity fee associated with these features
BuildLoan, in partnership with Hinckley & Rugby Building Society, has added two new low-fee products in its range.
The two products offer BuildLoan’s guaranteed stage payments during the build, linked to the cost of each stage of work without the usual indemnity fee associated with these features.
The 2-year discounted products offer an ERC-free option with an initial rate of 4.50% or a 2-year ERC option with a lower initial rate of 3.99%. Both products have an application fee of £199 and a completion fee of £800.
Funds are released in stages as the build progresses, with the pattern of releases agreed at application, so clients can plan their build, confident that they will receive funds when they expect them. This gives the reassurance that contractors can be paid, and materials purchased as the build progresses.
Read more: BuildLoan launches self and custom build products.
“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,” Chris Martin, head of product development and underwriting at BuildLoan, said.
“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 & Rugby Building Society, said that it important that brokers look very carefully at the features of any self-build product.
“Many other products rely solely on valuations during the build to determine the funds made available to the client – this can mean the client gets less than they expect and risk the build coming to a standstill,” Thornley-Yates said.
“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.”
