Mortgages on new builds work broadly like other residential mortgages: you apply based on your income, deposit, credit history, affordability and the property being bought. The difference is that lenders usually look more closely at the new build itself, the developer timetable, the valuation, any incentives, the warranty, the lease if it is a flat or leasehold house, and whether your mortgage offer will still be valid when the home is ready.

The biggest practical risk is timing. You may be asked to exchange contracts before the property is finished, but mortgage offers only last for a set period. If the build is delayed, the lender may need to extend the offer, update the valuation, reassess your income or ask for a new application.

This guide explains what to check before reserving a new build home, where mortgage applications can become harder, and when to speak to a broker before committing to a developer deadline.

This information is for general guidance only and is not personal mortgage advice. Your options depend on your circumstances, lender criteria and the property involved.

What is a new build mortgage?

A new build mortgage is usually a standard residential mortgage used to buy a newly built, newly converted or newly refurbished property. It is not normally a completely separate type of mortgage in the way that a buy-to-let mortgage is different from a residential mortgage.

The important difference is lender criteria. Some lenders have specific rules for new build homes, including:

• maximum loan-to-value limits
• different treatment for houses and flats
• rules on off-plan purchases
• mortgage offer validity and extension policies
• how developer incentives are disclosed and assessed
• warranty or professional consultant certificate requirements
• leasehold, service charge and ground rent checks
• building safety and cladding requirements for some flats

A property being brand new does not automatically make it easier to mortgage. The lender still needs to be satisfied that you can afford the loan and that the property is acceptable security.

Is it harder to get a mortgage on a new build?

It can be, but not always. If you are buying a finished new build house, have a strong deposit, straightforward income and no unusual property issues, the mortgage process may feel similar to buying an older home.

New build mortgages can become harder where:

• the property is not finished yet
• completion is several months away
• the developer wants exchange quickly
• you have a small deposit
• you are buying a new build flat
• the property is leasehold
• there are developer incentives
• the valuation is lower than the purchase price
• the building has cladding or building safety considerations
• your income is variable, self-employed or complex
• your mortgage offer may expire before completion

The aim is not just to find a lender with an attractive rate. The first question is whether the lender is comfortable with your circumstances, the property and the timescale.

Can you get a 95% mortgage on a new build?

Some borrowers may be able to get a mortgage with a 5% deposit, but availability depends on the lender, product, property type and your circumstances. It is not something to assume before reserving a plot.

In practice, higher loan-to-value borrowing can be more restricted on new builds than on older properties. Some lenders may be more cautious with new build flats than new build houses, especially where the deposit is small.

A 95% mortgage on a new build may depend on:

If you only have a 5% deposit, check the mortgage route before paying a reservation fee. Do not rely on a general agreement in principle as proof that the lender will accept the specific new build property.

Can you get a 100% mortgage on a new build?

True 100% mortgages are limited and are not available to every borrower or every property. Some products may involve family support, specific eligibility rules or other conditions. Whether a new build property is acceptable will depend on the lender and the product.

If you have no deposit, you should get advice before choosing a property. The key questions are:

• is there any lender route available for your circumstances?
• does that route accept new build properties?
• does it accept the property type, such as a flat or leasehold property?
• are family support or guarantor-style arrangements involved?
• what are the risks for the people providing support?
• what happens if the property valuation is lower than expected?

A developer saying that low-deposit options may be available is not the same as a mortgage offer.

What should you check before reserving a new build?

Before paying a reservation fee, make sure the mortgage route is realistic. A reservation may secure the plot for a short period, but it does not mean the lender will approve the mortgage or accept the property.

Use this checklist before committing:

GOV.UK’s home-buying guidance recommends understanding the process, costs and responsibilities before buying. public guidance also encourages buyers to consider affordability, deposit, mortgage payments and wider home-buying costs before committing.

A common trap: the agreement in principle does not fit the plot

A first-time buyer has a 5% deposit and an agreement in principle based on their salary and credit profile. They reserve an off-plan new build flat after being told the development is popular and the exchange deadline is tight. The reservation form shows a contribution towards legal costs, upgraded flooring and an estimated completion date around seven months away.

On paper, the monthly payment looks affordable. The problem is that the agreement in principle has not tested the details that matter most for this purchase: the lender’s new build flat loan-to-value limit, the lease terms, service charge, developer incentives and whether the mortgage offer would still be valid by completion.

A broker looking at this type of case would usually want the key facts before choosing a lender, not after the application has already been submitted:

The lesson is that a new build mortgage is not only about passing affordability. The specific plot, tenure, incentives and build timetable can decide whether the lender is the right fit. A reservation should ideally happen after those pressure points have been checked, especially where the deposit is small or the property is off-plan.

How do new build mortgages work?

A typical new build mortgage process looks like this:

The key difference from many older-property purchases is that exchange and completion can be separated by a longer period. That gap is where mortgage risk often appears.

New build houses versus new build flats

Lenders may treat new build houses and new build flats differently. This does not mean new build flats cannot be mortgaged, but lender choice can be narrower and the details matter more.

If you are buying a flat, ask early about lease terms, service charges, ground rent, building safety documents and whether the lender is likely to accept the block. GOV.UK has separate guidance on leasehold property and building safety matters, and your solicitor should advise on the legal position.

Off-plan new build purchases

An off-plan purchase means you agree to buy before the property is finished. This is common with new builds, but it adds risk because the lender is assessing a property that is not yet complete.

Off-plan purchases can create issues where:

• the build takes longer than expected
• the mortgage offer expires before completion
• the final property differs from the original plans or specification
• the valuation changes
• the lender’s criteria change
• your income, employment, credit profile or deposit changes before completion
• the developer asks you to exchange before all mortgage risks are fully understood

Before exchanging contracts on an off-plan purchase, check what happens if the build is delayed beyond your offer expiry date. The lender may consider an extension, but this is not guaranteed and may involve updated documents or a fresh assessment.

For more detail, read: how long does a mortgage offer last.

Developer incentives and new build mortgages

Developers sometimes offer incentives to help secure a sale. These may include:

• contributions towards legal fees
• cashback-style benefits
• upgraded fixtures or fittings
• flooring or appliance packages
• deposit contributions
• Stamp Duty contributions
• part-exchange arrangements
• payment of service charges for a period

These incentives must be disclosed to the lender. The lender may take them into account when assessing the true purchase price, valuation and loan-to-value.

The risk is not the incentive itself. The risk is failing to disclose it properly or assuming it will be treated the same by every lender.

Your broker, solicitor and lender all need clear information about the full financial arrangement. If an incentive appears late in the process, the lender may need to reassess the case.

How lenders assess new build mortgages

Lenders usually assess two things:

1. you as the borrower
2. the property as security

Both need to work.

Borrower assessment

For you as the borrower, lenders typically look at:

• income
• employment status
• affordability
• credit history
• existing credit commitments
• deposit amount and source
• dependants and household expenditure
• age and mortgage term
• residency status where relevant
• whether the mortgage is residential or buy-to-let

public guidance explains that buyers should consider what they can afford to borrow and repay, including the wider costs of owning a home. FCA rules also require regulated mortgage advice to take account of suitability and the customer’s circumstances.

Property assessment

For the property, the lender may consider:

• whether it is a house or flat
• whether it is complete or still being built
• valuation
• warranty or certification
• tenure, such as freehold or leasehold
• lease length, ground rent and service charge where relevant
• construction type
• building safety evidence where relevant
• location and development type
• saleability
• whether the property is acceptable security

The lender’s valuation is for the lender’s benefit. It is not the same as a full building survey or legal review.

Deposit and loan-to-value on new builds

Loan-to-value, often called LTV, is the mortgage amount as a percentage of the property value or purchase price used by the lender.

For example:

A larger deposit can sometimes increase lender choice, but it does not guarantee approval. The property, valuation, affordability and credit history still matter.

With new builds, the deposit question is not just how much you have. It is also whether the lender accepts:

• the source of the deposit
• any gifted deposit
• any developer contribution
• any scheme being used
• the loan-to-value for that property type
• the valuation figure used by the lender

Mortgage offer validity: the timing issue buyers miss

Mortgage offers are only valid for a set period. This is one of the most important new build mortgage checks.

Before exchange, confirm:

• when the mortgage offer expires
• whether the lender allows extensions
• how long any extension may be
• what evidence the lender may need for an extension
• whether another valuation may be required
• whether a credit check or affordability review may be repeated
• what happens if your income changes before completion
• whether your solicitor is comfortable with the completion timetable

Do not rely only on the developer’s estimated build date. Build dates can move.

If your offer expires, the lender may not be able to keep the same product, rate or decision available. Bank Rate set by the Bank of England can influence the wider mortgage market, but the rate you are offered depends on lender products, timing, loan-to-value and your circumstances.

Common mistakes with new build mortgages

Paying a reservation fee before checking the mortgage route

A reservation fee does not mean the mortgage is agreed. Ask what happens if your mortgage is declined, the valuation is lower than expected, or the developer deadline cannot be met.

Treating an agreement in principle as a guarantee

An agreement in principle can be useful, but it is not a binding mortgage offer. It may not fully assess the new build property, incentives, lease, valuation or final documentation.

Ignoring offer expiry

This is especially risky with off-plan homes. If completion is several months away, the lender’s offer validity and extension approach matter from the start.

Not disclosing incentives

All financial incentives should be declared. Undisclosed incentives can delay the application, change the lender’s assessment or create issues before completion.

Choosing a lender before checking new build criteria

Not every lender has the same appetite for new build flats, high loan-to-value borrowing, leasehold terms, cladding issues, estate charges or developer incentives.

Underestimating buying costs

Your deposit is not the only cost. Depending on your circumstances, costs may include legal fees, valuation fees, survey costs, moving costs, insurance, service charges, estate charges and Stamp Duty Land Tax where applicable.

Exchanging too early

Once you exchange contracts, you are legally committed. If the mortgage later becomes unavailable, the consequences can be serious. Do not exchange until your solicitor and mortgage adviser are satisfied that the mortgage and legal position are understood.

New build mortgage risk matrix

What documents make a new build mortgage easier to assess?

You may not need every document at the first conversation, but the earlier these details are clear, the easier it is to identify the right lender route.

Borrower documents

• proof of identity and address
• payslips and P60 if employed
• accounts, tax calculations and tax year overviews if self-employed
• bank statements
• evidence of deposit
• gifted deposit letter if relevant
• details of credit commitments
• proof of bonuses, overtime or commission if used for affordability

Property and developer documents

• reservation form
• purchase price and plot details
• expected exchange and completion dates
• list of developer incentives
• property specification
• warranty details
• lease details if applicable
• service charge, ground rent and estate charge information
• solicitor details
• any building safety documents relevant to the block

Your solicitor will deal with the legal review, but your mortgage adviser needs enough property detail to avoid placing the case with a lender whose criteria do not fit.

What could new build mortgages look like in practice?

Example 1: first-time buyer reserving a new build house

A first-time buyer reserves a new build house for £320,000 and has a £32,000 deposit. That means they are looking at a 90% loan-to-value mortgage.

The key questions are:

• does the lender accept the property as a new build house?
• is 90% LTV available for this case?
• does the borrower’s income support the mortgage?
• is the deposit source acceptable?
• are there any developer incentives?
• will the offer last until completion?

If the property is nearly finished and the borrower has straightforward income, the case may be relatively standard. If completion is months away, offer validity becomes more important.

Example 2: buyer purchasing a new build flat off-plan

A buyer reserves a new build flat before construction is complete. The developer expects completion in eight months.

The mortgage may be affordable, but the timing is more complex. The borrower needs a lender whose offer validity and extension policy can work with the expected completion date. The lender also needs to be comfortable with the flat, lease, block and development.

The buyer should be careful before exchanging contracts. If the build is delayed, they may need an offer extension or a new application, subject to criteria and products available at that time.

Example 3: developer incentives included

A buyer agrees to purchase a new build for £400,000, with the developer offering upgraded flooring and a contribution towards costs.

The incentive must be disclosed. The lender may consider whether it affects the true purchase price or loan-to-value. The solicitor may also need to report relevant incentives to the lender.

If the buyer applies without making the incentive clear, the case may be delayed or reassessed later.

Example 4: mortgage offer expires before completion

A borrower receives a mortgage offer, exchanges contracts and then the build is delayed. The offer is due to expire before the property is ready.

The lender may consider an extension, but this is not guaranteed. The lender may ask for updated payslips, bank statements, a credit check or a valuation review. If affordability, rates or criteria have changed, the extension may not be available on the same basis.

This is why timing should be discussed before exchange, not after a delay happens.

When should you speak to a broker about a new build mortgage?

It is sensible to speak to a broker before reserving or exchanging if:

• you are buying off-plan
• the developer wants a quick exchange
• your deposit is small
• you are buying a new build flat
• there are developer incentives
• you are self-employed
• your income includes bonus, commission or overtime
• you have recent credit issues
• you are relying on a gifted deposit
• completion may be several months away
• you are unsure whether the offer will last long enough
• you have been declined by a lender already

A broker can help you understand which lenders may be more likely to consider your situation and which routes may not fit. For complex cases, the value is often in knowing where not to apply as much as where to apply.

We cannot promise that a lender will approve your application or that a particular rate will be available. We can review the facts, explain likely pressure points and help you approach the mortgage in a structured way.

If you are considering a new build purchase, speak to a mortgage adviser before you commit to deadlines.

• Speak to a mortgage adviser
• Make a finance enquiry
• How much mortgage can I afford?
• How do mortgages work?
• How long does a mortgage offer last?
• Mortgage deals for first-time buyers
• Joint borrower sole proprietor mortgage
• Nationwide Helping Hand mortgage

What should you read next?

• How to get a mortgage in 5 essential steps
• UK swap rates and mortgages
• How to remortgage your Help to Buy loan
• Can a student loan affect a mortgage?

FAQs

Do new builds need a bigger deposit?

Not always, but some lenders apply stricter loan-to-value limits for new builds, especially flats. A larger deposit may increase lender choice, but it does not guarantee approval.

Are new build mortgage rates higher?

There is no single new build rate. The rate available depends on the lender, product, loan-to-value, property type, application date and your circumstances. Some products may be available for new builds and others may not be.

Can I exchange contracts before my mortgage offer is issued?

This is risky. Once you exchange, you are legally committed. You should not exchange unless your solicitor and mortgage adviser are satisfied that the mortgage and legal position are understood.

What happens if the new build is delayed?

If the delay means completion will happen after your mortgage offer expires, the lender may consider an extension or may require reassessment. This can involve updated income evidence, bank statements, a credit check or valuation review. An extension is not guaranteed.

Do I need a survey on a new build?

The lender’s valuation is not a full survey. You may wish to consider your own survey or snagging inspection, depending on the property and your attitude to risk. Your solicitor can advise on legal documents and warranties, but they do not inspect build quality.

Do developer incentives affect the mortgage?

They can. Incentives should be disclosed to the lender and solicitor. The lender may take them into account when assessing valuation, purchase price and loan-to-value.

Are leasehold new builds harder to mortgage?

They can involve extra checks. Lenders and solicitors may review lease length, ground rent, service charges, estate charges, building management arrangements and any restrictions. GOV.UK provides guidance on leasehold property, but you should take legal advice on the specific lease.

Is a mortgage agreed once I have an agreement in principle?

No. An agreement in principle is only an initial indication. A full mortgage offer depends on the lender assessing your documents, affordability, credit profile, valuation and the property.