New Build Mortgage Guides
The sequence and the traps on a new build purchase, from reservation to completion, including the schemes worth using and the ones that are not.
New build purchases run on different rules from second-hand ones: shorter mortgage offer validity, lender panels restricted by developer and by warranty provider, incentive disclosure that affects the valuation, and on flats the EWS1 question. Getting any of these wrong late in an off-plan purchase can mean reapplying at a worse rate against a long-stop date.
The scheme that matters most right now
Own New Rate Reducer routes a developer contribution of 3% to 5% of the purchase price through the lender as a rate subsidy, and it is currently producing initial-period rates as low as 1.87% at 80% LTV, well below anything available on the open market.
It only works on participating developments and through approved brokers. Doulton is approved. The Rate Reducer guide covers which builders and lenders participate and when the maths genuinely favours it over a standard product.
Deposits and incentives
New build deposit requirements differ between houses and flats, and developer incentives, whether cashback, paid stamp duty, upgrades or furniture, all have to be disclosed and all affect the figure the lender will actually lend against.
An incentive that looks like free money can reduce your borrowing. The incentives and deposit guides work through this with numbers.
Frequently asked questions
What deposit do I need for a new build?
Typically 10% on a new build house and 15% on a new build flat, though 5% is available through the mortgage guarantee scheme at a narrower panel. Own New Rate Reducer generally needs 20%, which is why the rate is so low.
What is Own New Rate Reducer?
A scheme where the developer's incentive budget is routed through the lender to subsidise the interest rate for the initial fixed period instead of being paid as cashback or upgrades. It is currently producing rates as low as 1.87% at 80% LTV on participating developments, through approved brokers only.
How long is a new build mortgage offer valid?
Usually six months, where a second-hand purchase offer runs three to six. Several lenders extend to nine or twelve months specifically for new build. On an off-plan purchase with a long-stop date beyond the offer expiry, the extension policy matters more than the rate.
Do I need an EWS1 form?
For a flat in a building over eleven metres, most lenders will ask for one. On a new build the developer is responsible for providing it. Without it, mainstream lenders will generally not proceed, and the flat can be effectively unmortgageable until one is issued.
Are new build flats harder to mortgage?
Yes, on three counts: a higher deposit requirement than houses, lender exposure caps limiting how many units in one development a single lender will fund, and the EWS1 question on anything over eleven metres. None of these is insurmountable, but all of them narrow the panel.
What happens if the build is delayed past my offer expiry?
You apply for an extension, and if the lender will not extend you reapply, which means a fresh valuation, fresh underwriting and today's rates rather than the rate you were offered. Starting the extension conversation eight weeks before expiry, not two, is what keeps the original rate in play.
Check the scheme before you reserve
Send the development, the plot and the incentive on offer, and we will tell you which lenders are on panel, what the incentive does to the valuation, and whether Rate Reducer beats the open market on your numbers.