Self Build  

Ipswich changes self-build lending criteria

Ipswich changes self-build lending criteria

Ipswich Building Society has enhanced its self-build lending criteria to accept modern methods of construction (MMC).

Modern methods of construction typically involve prefabricating the structural units of a building off site, or manufacturing them on site by contemporary methods.

It is an increasingly attractive option for self-builders, as a survey of 250 house-builders by the Build Show found that a massive 67 per cent said that modern methods of construction will play a key role in new-home supply in the UK.

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The change relates to new borrowers, in addition to those looking to remortgage and applies across the society's existing range of mortgage products.

This includes its recently relaunched self-build discount product, which has a decreasing early repayment charge of 3 per cent for the first 12 months and zero for the remaining 12. 

Richard Norrington, chief executive at Ipswich Building Society, said: "Through our commitment to seeing diversity in mortgage lending, we have made changes to our lending criteria to further support the growing community of self-builders.

"I am delighted that we continue to offer mortgage applicants an alternative to the machine-only mortgage application processes used by some larger lenders.

"By assessing each mortgage application on its individual merits, we can take a true assessment on credit-worthiness,and make an informed decision when lending."

Within the society's new rules, the applicants' chosen scheme must be accredited through the Buildoffsite Property Assurance Scheme (BOPAS), which provides lenders with assurance that the properties are sufficiently durable and readily saleable for a minimum of 60 years. 

All mortgage applications will be considered on a case by case basis.

The society's mortgage products benefit from a 50 per cent fee-free overpayment facility, which means borrowers can overpay penalty free by up to 50 per cent of the original loan amount.

Carl Shave, director of Suffolk-based Just Mortgage Brokers, said: "The Ipswich Building Society has been a recognised self build mortgage provider for many years and this change of criteria cements their commitment further in this niche area.

"With changing demands and construction types, having a lender that embraces these gives scope for future self builders to find funding at affordable rates with flexible criteria."