New build mortgages

Purchasing a new-build is becoming a popular property route for many home buyers due to the choice and Government incentives such as the Help to Buy Scheme.

Buying a new-build property in Scotland comes with its own set of opportunities and considerations. Whether you’re drawn to the appeal of a modern home, energy efficiency, or customisable features, it’s important to understand how mortgages for new-build homes differ from those for existing properties.

New-build mortgages are designed specifically for properties that are either under construction or have just been completed. While the mortgage process is similar to standard home loans, there are key differences in timing, deposit requirements, and lender conditions that buyers should be aware of before committing.

This section breaks down what to expect when securing a new-build mortgage in Scotland.

• Checking mortgage eligibility early: Before you reserve a plot or sign any contracts, it’s a good idea to speak to a mortgage advisor. Lenders often have different criteria for new-builds; some may only lend on certain types of properties (such as houses rather than flats), or apply stricter lending limits.
• Securing a Mortgage in Principle: A mortgage in principle helps you show the developer that you’re a serious buyer. It gives an indication of what you may be able to borrow and can speed up the buying process.
• Meeting deposit requirements: Many lenders ask for a larger deposit on new-build properties, often around 15 to 25 percent. This is partly due to the potential for a property’s value to drop slightly after completion, as with any brand-new asset.
• Navigating developer deadlines: Developers often set a strict completion window for buyers to finalise their mortgage and legal arrangements. Delays in the mortgage process can cause issues, so it’s essential to work closely with your solicitor and mortgage advisor to stay on track.
• Using incentives and schemes: Some developers offer incentives, like paying legal fees or contributing to your deposit. Additionally, government support schemes may be available to help first-time buyers purchase new-build homes, so it’s worth exploring all options.

New-build homes can offer peace of mind with warranties, lower maintenance costs, and modern living standards. But buying one requires careful planning and an understanding of how the mortgage process differs. At ESPC Mortgages, we can offer you friendly impartial advice, making sure you understand the mortgage choices you can choose from for your new build home.