Are shared equity mortgages only available on new-build homes?
No. While many schemes are linked to new-build developments, some shared equity initiatives may also be available for certain properties on the open market, depending on the scheme rules.
Can I remortgage a shared equity property?
In many cases, yes. However, the lender and equity loan provider may need to approve the new mortgage arrangements.
What happens if house prices rise?
If the property increases in value, the amount owed to the equity loan provider will usually increase proportionally because repayment is often based on a percentage of the property’s current value.
Can I repay the equity loan early?
Many schemes allow partial or full repayment of the equity loan before the property is sold, although conditions and valuation requirements may apply.
Do I pay interest on the equity loan?
This depends on the scheme. Some shared equity arrangements offer an initial interest-free period, while others may charge fees or interest from the outset.
Do I own the property with a shared equity mortgage?
Yes. You own 100% of the property and are named on the title deeds. The equity loan provider does not jointly own the property but is entitled to recover its agreed share when the loan is repaid.
Are self-build mortgages more expensive than normal mortgages?
Interest rates and fees can sometimes be higher due to the specialist nature of self-build lending, although costs vary significantly between lenders and projects.
How long does a self-build mortgage last?
The build phase typically lasts until construction is completed, after which the mortgage often converts to a standard residential mortgage product.
Can I build an eco-home using a self-build mortgage?
Yes. Many lenders support sustainable and energy-efficient self-build projects, including homes incorporating renewable energy technologies.
What is an advance stage payment mortgage?
This type of self-build mortgage releases funds before each stage of construction begins, helping with cash flow during the build.
Can I do some of the building work myself?
Many self-builders undertake some work themselves, but lenders will usually want reassurance that the project can be completed to the required standard.
Do I need planning permission before applying?
In most cases, lenders will expect planning permission to be in place before issuing a formal mortgage offer.
Can first-time buyers get a self-build mortgage?
Yes. Some lenders will consider first-time buyers, although they may require additional evidence that the project is realistic and affordable.
How much deposit do I need for a self-build mortgage?
Most lenders require a deposit, although the amount varies depending on the project and lender. Larger deposits may provide access to a wider range of products.
What happens when my fixed-rate mortgage ends?
In most cases, the mortgage will automatically move onto the lender’s Standard Variable Rate unless you arrange a new mortgage product beforehand.
Can a variable rate mortgage save money?
Potentially. If interest rates fall and your lender reduces its SVR, your monthly repayments may decrease. However, there is no guarantee that this will happen.
Why do many borrowers leave the SVR?
The Standard Variable Rate is often higher than the rates available on new mortgage deals. Many homeowners choose to remortgage when their initial deal ends to secure a more competitive rate.
Are variable rate mortgages risky?
They can be. If interest rates rise, your monthly repayments could increase. Borrowers should ensure they can comfortably afford higher payments if rates move upwards.
Can I leave a variable rate mortgage without paying penalties?
Many variable rate mortgages do not have early repayment charges, but this varies between lenders. Always check the mortgage terms before switching.
Is a variable rate mortgage the same as a tracker mortgage?
No. A tracker mortgage follows a specific benchmark rate, whereas a Standard Variable Rate mortgage is set by the lender.