For the most part, applying for a mortgage is the same regardless of whether your home is newly built or a historical gem.

However, there are a few things to think about when buying a new build property.

Mortgage offer period

Buying a new build off plan (before it’s built) is common. But it's worth considering how long your mortgage offer is valid for and when the property will be completed.

At Generation Home, our mortgage offers are valid for 90 days, with a further 10-day grace period for new build purchases.

Because of this, we recommend starting your Generation Home application 4 months before your new home is ready and you can complete on the purchase.

We recognise that new builds can be delayed, and we can consider applications where completion is up to 7 months away as we can extend this offer for a further 90 days.

Please keep in mind that to extend a mortgage offer, we will need to verify that your income, expenses and credit file haven't suddenly gone downhill. You can learn more about how to extend your mortgage offer here.

Deposit requirements

If you’re looking to buy a new build, be prepared to save up a bigger deposit.

Mortgage lenders tend to be stricter on the amount they are willing to lend on new builds. This is because – like a new car – a new build home will depreciate in price the minute you collect the keys.

The loan-to-value requirements differ according to lender, but at Generation Home, we require a 15% deposit for new build purchases.

Developer freebies

Some property developers will offer to pay buyers' Stamp Duty or legal fees. This is because a developer would much rather offer an incentive than reduce their purchase price.

It's worth noting that lenders will take account of any developer incentives when considering your mortgage.

At Generation Home, any incentive that you've been given by the developer would be deducted from the purchase price when we look at your mortgage application.

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