Over the past few years, several myths have surfaced around the self-build sector. To address some of these myths, we asked Tom McSherry of Buildstore to create a myth-busting guide for clients. This article addresses these misconceptions and highlights some pioneering products BuildStore has developed to overcome challenges previously faced by individuals undertaking a home building project.
MYTH: "SELF-BUILD MORTGAGES ARE TOO RISKY AND HARD TO GET."
REALITY: Many people believe that self-build mortgages are difficult to qualify for or carry higher risks. However, BuildStore Mortgage Services offers tailored products specifically designed for self-builders. With access to the entire market and over 70 exclusive mortgage products, they provide flexible lending options for various project types, including barn conversions, self-builds, custom builds, home improvements, major renovations, and property extensions. These products enable borrowers to gain confidence and access funding more easily than with conventional lenders.
MYTH: “YOU CANNOT GET A SELF BUILD MORTGAGE TO BUY LAND.”
REALITY: Unlike a traditional mortgage, which gives you the loan as a lump sum, self-build mortgages release funds in stages. You can get funds first for the land purchase and then at various construction milestones. These can be released either in advance (at the beginning of each stage) or in arrears (after each stage is completed), depending on your agreement with the lender Buildstore mortgage Services have products which can provide up to 95% of the purchase price of the land followed by up to 95% of the build costs.
MYTH: "YOU NEED A LARGE DEPOSIT TO GET A SELF-BUILD MORTGAGE."
REALITY: While it’s true that some lenders’ self-build products require larger deposits, BuildStore offers lending options that reduce this need. Stage payments of up to 95% of the land and build costs are available, with funds released either before each stage of the construction works or as each construction stage is completed. This opens the door for first-time buyers to commission, design, and build their own home. The stage payment structure also allows borrowers to better manage cash flow throughout the build.
MYTH: "FUNDS ONLY BECOME AVAILABLE ONCE CONSTRUCTION IS COMPLETE."
REALITY: This belief stems from the limitations of arrears-based mortgages, which release funds after significant construction milestones or as the project value increases. While this product style may work for some, BuildStore’s guaranteed stage payment mortgages release funds throughout the project, either in arrears or in advance of each stage on a guaranteed basis.
This enables borrowers to cover costs for land, materials, and labour without the fear of the project not increasing in value in line with the build costs. This is particularly relevant on a renovation or conversion project where the site is likely to reduce in value in the early stages. As an independent mortgage specialist, BuildStore Mortgage Services has access to the entire market, allowing tailored lending and cash flow solutions for every project.
MYTH: "SELF-BUILD PROJECTS TAKE LONGER TO COMPLETE DUE TO FINANCING DELAYS."
REALITY: While a stage payment mortgage needs to be tailored to each project, which can add some time to the process, BuildStore’s specialised products are designed to support the unique pace of self-build projects. With tailored lending and dedicated support teams, they ensure that funding aligns with the project timeline, minimising unnecessary delays.
MYTH: "SELF-BUILD MORTGAGES HAVE HIGH INTEREST RATES."
REALITY: There is a misconception that self-build mortgages carry prohibitive rates. BuildStore dispels this by offering competitive rates specifically for self-build projects, along with mortgage advice to help borrowers secure the best financing package for their project and budget. With rates starting from as low as 5.75%, there is now little difference between high-street rates and self-build mortgage rates. BuildStore also offers a concession of interest-only payments during the build, along with a free product switch upon project completion.
MYTH: "ONLY EXPERIENCED BUILDERS CAN GET SELF-BUILD FINANCING."
REALITY: Many assume that self-build mortgages are only available to those with a construction background. BuildStore works with experienced homebuilders as well as first-time buyers and renovators, offering guidance and support throughout the process—from a costing service, tailoring the cashflow to supporting clients throughout the stage release process. This makes self-build accessible even to those new to the homebuilding market.
MYTH: "SELF-BUILD MORTGAGES DON'T COVER OFFSITE-MANUFACTURED SYSTEMS."
REALITY: Traditional mortgages may be limited in scope, but BuildStore provides flexibility for unique projects, including eco-homes and modular builds. With over 30,000 projects funded over the past 26 years, their specialist products support a wide range of construction types, including structural timber frames, insulated concrete formwork (ICF), oak frames, and structural insulated panels (SIPS), as well as traditional building methods. This flexibility allows borrowers to pursue creative, sustainable, and personalised builds.
MYTH: “YOU CANNOT HAVE TWO RESIDENTIAL MORTGAGES AT THE SAME TIME.”
REALITY: You can have two residential mortgages at the same time if one is your current main residence and the other is a self-build mortgage. This can allow you to remain in your current home until your new homebuilding project is completed rather than selling in advance of the project to secure the land and or build the new home. Responsible lending is important and it must be affordable to support both mortgages at the same time.
MYTH: “ YOU CANNOT GET A SELF-BUILD MORTGAGE WHEN YOU ARE RETIRED ON NEARING RETIREMENT”.
REALITY: There is short term products designed specifically for clients who may be asset rich and income poor. With many clients looking to downsize in retirement these products do not have the same age restrictions as a standard selfbuild mortgage and are based on assets rather than income. This is ideal for clients often looking to build in the garden and sell the current home on completion of the new build. There are time restrictions on how long you can have the funds for so it is important that you seek the services of a specialist like Buildstore Mortgages.
As the UK’s largest independent mortgage specialist, BuildStore Mortgage Services is uniquely positioned to turn self-build dreams into reality by dispelling these myths and providing factual, practical, flexible, and accessible financing solutions for everyone.
