Self Build mortgages

[the_r_sole]

anyone know much about these?
I have identified a piece of land and hoping to buy it with the sale of a flat
but I would need a mortgage to cover the actual build

my biggest issue at the moment is being self-employed, but for the purposes of getting a mortgage I can become an employee!
Just wondering if the amount of borrowing is different with a self build mortgage and if there are any pitfals which would mean I couldn't get one, also how long would they be looking for payslips etc to prove my employment?

 

[Yaayuh!]

I'm sure it'll be a lot hard in the current climate. Lending you money on something that doesn't exist.
I would assume you'd get a small percentage upfront and then loan the rest later?

I'm not sure how it works, but you can bet your manhood that it's going to be hard.

 

[Hamish]

I'm sure it'll be a lot hard in the current climate. Lending you money on something that doesn't exist.
I would assume you'd get a small percentage upfront and then loan the rest later?

I'm not sure how it works, but you can bet your manhood that it's going to be hard.

On Grand Designs (the TV show) they release the money bit by bit and they get the next installment once they reach certain milestones.

 

[Nightglow]

You want to pop down to 'The National Self Build & Renovation Centre' at Swindon.
Every thing to do with self build, fiance, materials, land, etc is covered.

http://www.buildstore.co.uk/mykindofhome/index.html

 

[the_r_sole]

I have phoned buildstore and waiting for them to get back to me - I know the way they work, basically you get a staged release of funds so that you're not having to pay the full whack of interest while the hole in the ground isn't worth anything!

I should have the land purchased and can use the value in that as security against the mortgage as well as a salary

but it was more the level of cash against my (potential) salary and what peroid of time i would have to be working before they'd give me anything

 

[PapaLazaru]

Nobody will lend against potential salary. Being self-employed is not a hindrance, as long as you can show your last 2 years SA302's (Tax Calculation Summary) issued by the HMRC. You will also need to provide 3 months business and personal bank statements as a maximum. There is no point pretending you are employed as any lender will see right past it.

As has been said, getting a self-build mortgages in the current finacnial climate will be a total ball-ache.

 

[the_r_sole]

sorry, no, I will actually be employed, the salary will be real, but I need to make sure the salary is going to make it possible to get a big enough mortgagefor the build - Being self employed with a decent accountant does make it a hindrance as profits showing in the last couple of years are very low

 

[PapaLazaru]

sorry, no, I will actually be employed, the salary will be real, but I need to make sure the salary is going to make it possible to get a big enough mortgagefor the build - Being self employed with a decent accountant does make it a hindrance as profits showing in the last couple of years are very low

But you are not employed in reality?

Make up a payslip all you like, they will see right past it. Trust me. I work for a mortgage lender. I catch people all the time. A quick director or company check which we do for any payslip we are not sure about will show that you are not an employee. It is also called fraud.

Profits of your business are not actually taken into context when lending on a mortgage. It is the amount you have declared to the HMRC as your taxable income. This is what shows what you can afford. You will need to show 2 years minimum as well.

 

[the_r_sole]

I will be employed - there is no fraud going on, what aren't you getting here? I won't be making up payslips, I will 100% be on a salaried position in a company - however at the moment it makes sense for me to be self employed working on a contract basis.