Content Writer
Head of Bridging & Commercial
If you’re planning to build your own dream home, you’ve likely realised that financing a self-build project works very differently to getting a traditional mortgage.
The good news is, our self-build mortgage calculator and comprehensive guide to using it, can help you to plan your project cash flow, estimate your borrowing limits, and get an idea of what your monthly repayments might be at each stage of the build.
How does a mortgage calculator for self-build work?
Our self-build calculator calculates your rolling monthly interest payments you could expect to pay for each tranche (funding phase) of your project.
Most self-build mortgages operate on an interest-only basis, and because you only pay interest on the amount you have drawn down to date, it’s important to have a good idea of your complete construction plan, including each tranche and how much you will need to complete them.
Typical Self-Build Stage Releases (Tranches)
- Land Purchase - with outline or detailed planning permission
- Substructure - Laying of foundations, footings, and ground floor slab
- Wallplate - Construction of the external walls up to roof level
- Roof Tiling - Installation of roof structure, doors and windows, as well as any tiling and other waterproofing
- First fix - Internal plastering, initial wiring and plumbing
- Second fix - Installation of kitchen, bathrooms, heating systems and decoration
- Final completion - Final inspection sign-off, and remortgage onto a traditional mortgage
Self-Build interest repayment calculator
Using our interactive self-build mortgage calculator tool below, input the borrowing required at each stage of the project, as well as a prospective interest rate. Your results will show your repayments at each stage, based on the cumulative drawdown of funds as you move through the tranches of your project.
Total Amount Borrowed: £0.00
Monthly Repayments: £0.00
Please note: As interest rates are bespoke to the specific details of your project, this calculator can only provide a guide to how much your repayments may be, based on your inputs. For a clearer idea and bespoke figures, speak to an expert broker.
How much can you borrow for self-build?
A self-build mortgage calculator cannot determine how much you can borrow. Because self-build lending is bespoke to the individual project, there is no formula that can provide a useful figure.
When lenders calculate your maximum borrowing, it is typically based on the following factors:
A multiple of your gross annual income - typically 4.5 x income multiple, but this will depend on broader factors, such as your income level, profession and credit history
The anticipated gross development value (GDV) of your project - this is the estimated market value of your finished home. Most lenders restrict maximum borrowing to between 75% and 85% of either the (GDV) or the total land value + build costs
Project specifics - Lenders will expect you to have included at least 10% of the total loan value as a contingency fund, and will also look at the type of contractors you will hire
Lenders may also have maximum borrowing caps ranging from £500,000 and £4 million. If your total project cost is more than this, you’re likely to need a specialist lender.
Get a bespoke self-build mortgage quote
Example self-build calculations
To help you visualise your budget, here are some example scenarios calculated on our above calculator tool, that represent typical UK self-build projects.
Staged Drawdown & Monthly Payment Breakdown of £360,000 loan at 6.5% on a an interest-only basis, over a 12-month construction timeline:
Build Stage | Description | Stage Release Amount | Cumulative Loan Balance | Est. Monthly Interest Payment |
Stage 1 | Land Purchase | £120,000 | £120,000 | £650 / mo |
Stage 2 | Substructure (Foundations) | £40,000 | £160,000 | £867 / mo |
Stage 3 | Wallplate (Eaves Height) | £40,000 | £200,000 | £1,083 / mo |
Stage 4 | Roof Tiling (Watertight) | £50,000 | £250,000 | £1,354 / mo |
Stage 5 | First Fix (Plaster/Wiring) | £50,000 | £300,000 | £1,625 / mo |
Stage 6 & 7 | Second Fix & Final Completion | £60,000 | £360,000 | £1,950 / mo |
Staged Drawdown & Monthly Payment Breakdown of £225,000 loan at 6.5% on a an interest-only basis, over a 12-month construction timeline:
Build Stage | Description | Stage Release Amount | Cumulative Loan Balance | Est. Monthly Interest Payment |
Stage 1 | Land Purchase | £75,000 | £75,000 | £406 / mo |
Stage 2 | Substructure (Foundations) | £25,000 | £100,000 | £542 / mo |
Stage 3 | Wallplate (Eaves Height) | £25,000 | £125,000 | £677 / mo |
Stage 4 | Roof Tiling (Watertight) | £35,000 | £160,000 | £867 / mo |
Stage 5 | First Fix (Plaster/Wiring) | £30,000 | £190,000 | £1,029 / mo |
Stage 6 & 7 | Second Fix & Final Completion | £35,000 | £225,000 | £1,219 / mo |
Staged Drawdown & Monthly Payment Breakdown of £600,000 loan at 6.5% on a an interest-only basis, over a 12-month construction timeline:
Build Stage | Description | Stage Release Amount | Cumulative Loan Balance | Est. Monthly Interest Payment |
Stage 1 | Land Purchase | £200,000 | £200,000 | £1,083 / mo |
Stage 2 | Substructure (Foundations) | £60,000 | £260,000 | £1,408 / mo |
Stage 3 | Wallplate (Eaves Height) | £70,000 | £330,000 | £1,788 / mo |
Stage 4 | Roof Tiling (Watertight) | £80,000 | £410,000 | £2,221 / mo |
Stage 5 | First Fix (Plaster/Wiring) | £90,000 | £500,000 | £2,708 / mo |
Stage 6 & 7 | Second Fix & Final Completion | £100,000 | £600,000 | £3,250 / mo |
Speak to a self-build mortgage expert
While our online self-build calculator can be a good starting point, consulting with one of our experts before you apply will ensure you have a fully bespoke set of calculations that show you not only how much you could borrow, but how much you can expect to repay over the construction period of your project.
Our brokers can help you find the self-build lender that is happy to offer the amount you need, on the type of property you intend to build. We’ll even follow up to help you remortgage onto a standard project on the completion of your home.
If you’re looking for bespoke self-build mortgage calculations and want to take advantage of a free, no-obligation chat with an expert broker with self-build experience, get started here.
FAQs
Many mainstream lenders do not offer self-build construction loans. Self-build mortgages in the UK are usually funded by building societies or through specialist self-build brokers. However, once your self-build home is complete, you will be able to remortgage onto a standard residential mortgage from lenders like Santander or Hailfax to secure lower long-term interest rates.
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