Applying for Help to Build funding

The Government’s Help to Build scheme, aimed at helping wouldbe self and custom builders, officially opened this week.

Although this is a four-year scheme, speed could be of the essence as the equity loan fund is capped at £150m.

Similar to the Help to Buy homes scheme, the new fund will enable you to apply for an equity loan of between five per cent and 20 per cent of the estimated land and building cost.

The loan is interest-free for five years. This will allow borrowers to access low-deposit mortgages on both self and custom built homes.

Housing minister Stuart Andrew says: “Most people are currently priced out of this self and custom building because it can require huge sums up front. The average mortgage deposit is around 25 per cent of land and building costs.”

Self-build is when you organise the build yourself – from finding a plot and applying for planning permission to hiring architects and a builder.

Custom build is either a single dwelling commissioned by an individual and built by a developer or one of a group of homes on serviced plots that are built by a developer with the offer of bespoke design for the buyer.

You can apply for Help to Build if you are planning to live in the property as your only home and if you secure a self-build mortgage from a lender registered with Help to Build.

Most lenders will need you to have outline planning permission. You can spend up to £600,000 on your new home and this must include the cost of the land, if you don’t already own it, and no more than £400,000 on the cost to build it.

You will need a deposit of at least five per cent for the loan plus a mortgage.

Details: www.ownyourhome. gov.uk/scheme/help-to-build