BuildStore has introduced significant enhancements to its BuildLoan scheme to make life easier for people wanting to buy a house which needs work done on it to bring it upto standard.
The BuildLoan Ideal Home Improvement Mortgage does away with the cashflow problems home improvers can have as a result of lenders not normally releasing money for the improvements until the work has been finished and inspected by a valuer.
Typically a lender will lend up to 95% of the cost of a house needing improvements but will apply a retention to the part of the loan covering the improvements until the work has been completed.
The lenders operating through BuildStore's Ideal Home Improvement Mortgage will lend up to 95% of the cost of the property being improved and will then lend up to a further 95% of the costs of the improvements in stages at the start of each stage to fund the improvements. Because these amounts are released prior to each stage being started, the borrower has positive cashflow during the improvements.
The money will be released at the start of each of the following stages during the improvements:
Stage 1: Stabilisation works, including the demolition and injection of DPC plus any roofing works necessary
Stage 2: Services first fix.
Stage 3: Practical completion of all rooms, with all rooms completed and plastered.
Stage 4: Internal finishes, including installation of kitchens, bathrooms, doors, facings and decoration.
The lender partners to the BuildLoan Ideal Home Improvement Mortgage are Skipton, TMB and Lloyds TSB Scotland. Both Skipton and Lloyds TSB Scotland will lend up to 95% of the projected final value of the house when improvements have been completed while TMB who will lend on a self-certified basis will lend up to 85% of the projected final value.
Applicants for a BuildLoan Ideal Home Improvement Mortgage will also receive a free Trade Card from BuildStore. This enables them to buy their building materials at special prices and with enhanced levels of service from national builders merchants Jewson and Builder Center as well as from a number of regional merchants and suppliers. In addition to the special prices and enhanced service, BuildStore's mortgage customers also receive a higher credit limit from these merchants than they normally would be able to negotiate.
The combination of positive cashflow from the mortgage and special prices and service from the Trade Card therefore will enable many more people than before to undertake a home improvement project.
Raymond Connor, founder and managing director of Buildstore, says: “BuildStore is keen to develop products which give intermediaries solutions to their clients needs. The positive cash flow provided by the BuildLoan Ideal Home Improvement Mortgage makes it much easier for their clients to afford to buy and improve a sub-standard property.”