Raising Finance of your Self-Build

One of the first steps when planning to build your own house is to get finance. It makes sense because without the necessary funds nothing can happen. For the vast majority of self-builders it all comes down to how much you can borrow. Some banks and building societies have special mortgages for people wanting to borrow money for something that does not exist yet, which is essentially what self-builder as seeking money for.

A lot of places will lend up to 75% of the finished property, while other will lend that for both the plot of land and the cost of the building work (at the time of writing Norwich and Peterborough building society offered this). Just like getting a normal mortgage the amount you can borrow for a self-build project is related to your income, whether that be a combined income or a single income. This is normally about 2 to 3 times income.

If you are planning to live in your property after the build then most of the mortgage avenues are open to you, but if you are a professional how plans to sell the property on then things get a little trickier. However, there are places to get finance from, and it is best to flick through self-build magazines where they advertise themselves.

Presenting to mortgage lenders

If is best to contact mortgage lenders very early in the self-build process, and we are talking about the stage when you are dreaming up the idea so that you can realistically gauge how much you may be able to borrow and what kinds of builds lenders will contemplate. If you have a mortgage for your current house you should start by discussing your ideas with them to see if they are open to the idea of lending to you for a self-build project. If they are not then you can widen your net and contact other lenders.

When having an initial chat with mortgage lenders don’t discuss intricate specifics but talk in general terms about the kind of building you are interested in building, and then see what kinds of things the lender will look at. You will probably be able to hone in on something you are both interested in pursuing and how much you can spend on it.

If you find a bank or building society that is open to lending you money you will then go away and prepare to act. Get everything together for the real mortgage meeting, and this includes any details of the proposed purchase of land, planning permission to build, proof of your income, and some kind of budget for building work. Having plans for your project is probably a bit over the top, but if you are planning to build a timber frame house you may be able to get hold of a build package from a timber frame company. This will further help show that you are prepared and know how much things will cost and how long they will take to build.

How lending works

Unlike traditional mortgages that are released in their entirety, loans to self-builders are released in stages as the build progresses. The easiest way for you to plan for this is to develop a schedule for the build and thus budget for the different stages. In full is takes around 8 months to build a house, although if you personally plan to take on a lot of the work yourself or their are unexpected delays, then things can take a whole lot longer. The list below roughly outlines the build stages and times:

  • Groundworks – 1 1/2 months.
  • Ground Floor Walls – < 1 month.
  • First Floor – 1/2 month.
  • Upper Floor Walls – 1 month.
  • Roof Carpentry – 1 month.
  • Roof Cover – 1/2 to 1 month.
  • Scaffolding – 2 to 3 months.
  • Fascias – 1/2 month.
  • Studwork – 1/2 month.
  • Wiring (1st fix) – 1/2 month.
  • Plumbing (1st fix) – 1/2 to 1 month.
  • Plastering – 1 month.
  • Carpentry – 2 months.
  • Kitchen – 1/2 month.
  • Wiring (2nd fix) – 1/2 month.
  • Plumbing (2nd fix) – 2 months.
  • Decorating – 3 months.
  • Externals – 2 months.
  • Tidying Odd Jobs – 1 month.

[the different stages overlap at times but follow this general flow.]

The general time to build a simple large 4 bedroom house should be about 3500 hours of work, which equates to 3 people working full time for 30 weeks. Generally this breaks down to a £4250 a week spend. In reality things are not as straight forward to this and all events throughout the build need to be carefully planned and coordinated. Getting 3 highly versatile and skilled people to work solidly is rare, and more often there are around 30 people involved in the build, each with their own expertise. Therefore you can expect some delays, but these can be minimized through careful planning and knowing who is needed when.

Release of funds

Each lender will differ slightly, but in general there are key milestones that get your money released. These are normally linked to (1) completed groundworks; (2) first floor joists placed; (3) watertight roofing; (4) plastering complete; (5) Finished build.

The lending will have a surveyor checking the progress as you try and claim for the next round of funds.


Getting money and then budgeting your spend correctly throughout your build can be a real headache. Having a detailed working plan of how the build will progress and how much each stage will cost will help you out enormously, and knowing when materials will arrive and when people need paid is a must if you want to avoid tricky cash-flow situations. Banks and building societies are willing to lend to self-builders, but be aware that you will get your money in stages rather than all at once, so careful management is essential.

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