Are your customers finding it difficult to finance their building project?

With the current climate, more homeowners are considering self build, renovation and home improvement projects, such as extensions and loft conversions. One of the biggest hurdles for homeowners is getting access to finance to fund such projects. However, with funding from our partners BuildStore Financial Services, you can be sure that your client has the cash-flow to pay you and buy the materials needed, allowing you to get to work straight away.

BuildStore work with a range of lenders, including banks and building societies, and has developed exclusive products that are not available elsewhere. Its expertise in understanding the process of a self build or major renovation projects means that it can advise each client on the right funding option for their individual project.

Earn yourself a commission!

You can earn £35 when you introduce your client (or potential clients) to BuildStore Financial Services. It’s easy! Simply leave a BuildStore Financial Services brochure with your client and if they call Buildstore and take up the finance you’ll earn a very decent introduction commission.

To find out how you can become a referrer and earn yourself a commission click here or call BuildStore Financial Services on 0845 223 4888 today.

Advice from industry mortgage experts

As with all sectors of the mortgage market, with the continued restrictions in mortgage funding, finance for self-build continues to be characterised not so much by what ‘deals’ you can get from what lenders (borrowing is relatively cheap in historic terms) but which lenders will lend for self-build at all; what their lending criteria is; how much they can lend you; who will they lend to and on what basis, and when will they release funds during the build to meet the project cashflow needs.

The good news for you and your clients is that a number of lenders have continued to strongly support the self build, renovation and home improvement market, and indeed many more are now looking at self build as a key sector for growth. BuildStore is seeing an uplift in new and exclusive products and financial solutions, which we expect to continue and increase through 2010 and beyond.

Become a referrer today

To find out how you can become a referrer and earn yourself a commission click here or call BuildStore Financial Services on 0845 223 4888 today.

Specialist advice for your customers

We would always recommend that anyone wishing to undertake a self build, renovation or major home improvement project for which they will need to borrow money, seek advice from a specialist adviser to ensure they get the most appropriate funding option for their particular needs. In the current climate, it’s all the more important that the adviser has access to the widest range of self-build and renovation mortgages in the market to meet those needs – as is the case with BuildStore.

Lenders are looking for higher deposits at the moment, so 85% lending on land costs and build costs is more common, whereas it was up to 95% pre-credit crunch. The amounts a self builder can borrow vary by lender and by the type of finance, depending on the lender, the product and the way the finance is structured.

To see all current self build mortgages, visit: http://www.buildstore.co.uk/finance/mortgages/tracker.html

The most important consideration for a self builder is cashflow – how will they be funding the build, and when will they need access to the funds.  Typically, a self builders will need an initial advance to purchase the land and cover initial costs, and then further payments to meet ongoing phases of the work – normally there are four or five subsequent stages. 

Depending on a self builder’s finances and the cashflow needs of the project, BuildStore would recommend either an advance stage payment ‘Accelerator’ (developed by and exclusive to BuildStore), or an arrears stage-payment mortgage.  With the Accelerator, funds are released for the purchase of the land and then released in stages advance of the costs of the works.  There are a number of benefits here – stage funding is based on actual scheduled costs (rather than the change in value of the build as it progresses); funds are available when the self builder needs them, rather than once the work has been done.  Because of this, they can to progress with the project without delays and hold-ups, and can pay for materials and settle invoices promptly.

Lenders are looking for ways to reduce risk, so are increasingly turning to specialists to help them not only keep close to a borrower during a project, but also add expertise in terms of helping borrowers identify their cash flow requirements while planning and preparing for the project. This will continue to be important, as many lenders will no longer do further advances, making the need to get costs and contingency budgets right before starting the project absolutely vital.

What next?

For more information on self build mortgages and to learn about how you can introduce your clients and customers to BuildStore's range of financial solution, which also include site and project insurance, click here