We had some savings from the earlier sale of our flat but required a mortgage to buy the land and finance the build.
We have used BuildStore Financial Services.
We first encountered them in Swindon at the NSBRC where they assisted us to calculate what we might be able to borrow. With that figure we calculated the maximum we could spend on a plot.
Once we had our offer accepted on the plot, July 2012, we contacted Buildstore and were allocated a mortgage broker. A lovely bloke called John who was located up in Scotland. Over the phone we went over the details and filled out all of the forms. He was really helpful and took us through all the possibilities on offer and how to maximise the loan value. Then he went away to see what he could get us. He came back to us within a week.
We originally went for an Accelerator Mortgage. This was why we used BuildStore, as they are the only people who sell these mortgages (it is a product that they helped to develop). Accelerators release the funds prior to each stage of building rather than retrospectively. This is meant to ease cash flow and allow the project to proceed without pauses caused by needing to have the property revalued and then funds authorised and released.
As it turned out, only two providers were offering it at the time, one of which couldn't cope with Dimitri's freelance employment status. The other, Melton Mowbray Building Society had accepted us in theory and we had begun to submit the mountain loads of documentation required. The most pressing of which was that was the design details of the house we were proposing to build were required in order to process the application; elevations, floor plans, cost estimates, etc.
We quickly appoint a designer (for that story see here). This is a huge leap of faith as we have to pay design fees before we actually own the land. In England this is risky as the vendor can withdraw, penalty free, from the sale anytime up to the exchange of contracts.
The first issue to be raised is that our much beloved and trusted family solicitor is rejected by the mortgage company due to the fact that there are not enough partners in his firm. Slightly ironic considering the size of their own financial institution - you'd think they'd be supportive of smaller firms with a more personal service! So it takes a week or so to choose and instruct a new solicitor, it's now late August 2012. In my naivety I believe that it will be a matter of weeks and we should be able to exchange contracts by the end of September.
At some point in September 2012 the Vendor's Solicitor finally gets around to passing over the relevant documents and we discover for the first time that the plot has Title Possessory instead of Title Absolute (this means that the physical deeds were lost at some point). Melton Mowbray is informed and they tell us that they will not lend with only possessory title. So it's back to John at Buildstore. He spends a couple of nail biting weeks calling each and every provider to speak to their underwriters to find someone who might provide a mortgage. We know that we won't be able to have an Accelerator mortgage now, so think about whether it is worth using Buildstore anymore but we've come this far with them and they already have a lot of paperwork. We press on.
But also in September the first drawings were back from Charlie Luxton Designs and our new house is looking amazing.
At the beginning of October 2012 we have a new lender in theory, Ipswich Building Society. All the documentation is already with Buildstore. We have been allocated a single point of contact to help collate all the documentation, but unfortunately this doesn't work in practice as people are always going on annual leave and we are now on our fourth handler. In this digital age where all our bank statements and wage slips are online Buildstore struggles with the concept and persists in requesting original bank statements and wage slips. We explain patiently that they simply don't exist, we can print out things and send them but they will identical to the copies they print out - they don't exist as originals. It is frustrating to say the least and leaves us incredulous at how people can't/aren't allowed too exercise their own judgement - computer says no!
Buildstore's experts are apparently going to be checking all the documents before they are sent to the mortgage company. This, it is explained to me, allows the mortgage company to process the application faster as everything has already been checked by their team. We'll see.
Despite calling Buildstore on a weekly basis in order to check on the progress of the processing. I hear nothing until the end of October, three weeks of frustration. The documents have been with them for a month and they send an email which amongst other things asks for everything to be certified, all the bank statements, etc. Also the standard certifying method which my solicitors use apparently will not suffice in this instance, so everything which has already been certified now needs to be re-certified. I reply apoplectic with rage about what they are asking, and why it has taken so long for them to address these issues.
Eventually the documents are checked and passed on to the Mortgage Company. There is then a couple of weeks of correspondence between us, via Buildstore, regarding Dimitri's employment contracts and pay structure. Financial institutions still find it impossible that people may earn a living in a non-standard way i.e. Freelance blows their minds...
By the end of November we seem to have been deemed OK, and a valuer is dispatched to the plot at the beginning of December. On December 17th, one week before Xmas we are issued a mortgage offer!!!
The first couple of weeks of January I research and purchase site insurance as a condition of the mortgage. Insurance underwriters it seems also take their own sweet time to get back to you.
Mid January we finally purchase the plot. It only took 6 months!
Lessons learnt -
Everyone takes their own sweet time, in no particular hurry. You are simply a small insignificant cog in a huge machine. You can't reason, persuade, charm or shout to make things go faster. Sit back and take a leaf out of their book! This is where you perfect these useful skills for the rest of the build process.