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New Build developments are properties (houses and blocks of flats) built or converted within the past 12 months.
Examples of conversions; offices converted into flats, a professional barn conversion or a single dwelling turned into multiple flats.
We will normally restrict the LTV for this property type to 85%, however we can also lend up to 90% LTV on new build houses where the application meets the following criteria:
- Clean Credit history (0 missed payments in the last 3 years)
- As with all lending above 85% LTV, the maximum LTI is <4.5x income
- Income: At least 50% of the Homeowner's total income must be derived from Employed income (Employed income received from an Owners LTD company must be excluded from the 50%). We will not consider applications where the owners total income is solely from self-employment.
- Applications where the home owners have no employed income are not eligible for 95% LTV borrowing.
Example 1 > Employed owner receiving £50,000pa & a Self-employed owner receiving £40,000 dividends pa and a salary of £10,000pa. All income can be included.
Example 2 > Employed owner receiving £50,000pa & a Self-employed owner receiving £55,000pa. Only £50,000 of the Self-employed income should be keyed on the application.
- Maximum loan is limited to £500k
- Available on new build houses
- Not available on new build flats (Limited to 85%)
We will not lend against New Build developments where incentives paid to the purchaser are more than 5% of the purchase price.
Where incentives are less than £2,000 the incentive is allowed with no change to lending. Where incentives are greater than £2,000 but no more than 5% of the purchase price of the property, the value of the incentive will be deducted from the property value when calculating the LTV.
New Build Certificates
For any property built or converted within the last 10 years one of the following certifications will be required:
● National House-Building Council Buildmark Scheme (NHBC)
● Zurich Municipal Newbuild Scheme
● Zurich Municipal Rebuild Scheme
● Premier Guarantee for Private and Completed Housing
● Building Life Plans Scheme
● LABC Warranty
● LABC Warranty Scheme
● ICW Warranty Scheme
● One Guarantee Warranty Scheme
● Castle Ten / checkmate
● Global Home Warranties
Architect’s Certificate; The Professional Consultants used must have one or more of the qualifications listed in the CML Handbook 6.7.4
New Build Valuations
Valuations can be assessed using the floor-plan provided by the Builder and also the plot map. The market value is derived from that plus comparable property information. A re-inspection may be required where;
- there are significant changes from the floor plan reviewed by the valuer
- the valuation is more than 180 days old and therefore expired or
- it has been specified by the valuer within the original valuation report
The re-inspection fee is £75.