--- title: "New Build Mortgages | Deposits, Incentives & Timing" description: "New build mortgages: deposits on new build flats and houses, how developer incentives affect the loan, valuations, warranties, offer expiry and completion." url: "https://mortgagelane.com/guides/residential/new-build-mortgages" site: "Mortgage Lane" collection: "guides" date: "2026-07-03" author: "Joseph Lane" category: "Mortgage guide" reviewed: "2026-10-12" reading_time: "9 min" byline: "Joseph Lane" author_credentials: "CeMAP · FCA authorised firm" language: "en-GB" robots: "index,follow" --- # New Build Mortgages | Deposits, Incentives & Timing New build mortgages: deposits on new build flats and houses, how developer incentives affect the loan, valuations, warranties, offer expiry and completion. ## New Build Home Mortgages New build mortgages: deposits on new build flats and houses, how developer incentives affect the loan, valuations, warranties, offer expiry and completion. [New build mortgage](https://mortgagelane.com/definitions?term=new-build-mortgage) Residential A mortgage subject to a lender’s new-build rules on property condition, incentives, construction cover and completion timing. [Read the full definition of New build mortgage](https://mortgagelane.com/definitions?term=new-build-mortgage) Back to overview [Residential Mortgages](https://mortgagelane.com/mortgages/residential-property-mortgages) Related definitions [Loan-to-value (LTV)](https://mortgagelane.com/definitions#def-loan-to-value) [Underwriting](https://mortgagelane.com/definitions#def-underwriting) ## Talk to an adviser about new build home mortgages Speak to a Mortgage Lane adviser about your options. ## At a glance A [new build mortgage](https://mortgagelane.com/definitions#def-new-build-mortgage) is a [residential mortgage](https://mortgagelane.com/definitions#def-residential-mortgage) on a newly built home, and the main differences from a resale are the deposit, the incentives and the timing: some lenders lend less on new build flats, developer incentives above a set level reduce the price the lender lends against, the new-build premium can lead to a [down-valuation](https://mortgagelane.com/definitions#def-down-valuation), and a [mortgage offer](https://mortgagelane.com/definitions#def-mortgage-offer) must last until a home that may not yet be finished is ready to complete. Lenders also check the warranty or other construction cover they accept and require disclosure of developer incentives. Planning the [mortgage](https://mortgagelane.com/definitions#def-mortgage) around the build programme avoids an offer expiring before completion. ## How Mortgage Lane can help Mortgage Lane arranges new build mortgages for first-time buyers, movers and investors buying from national and local developers, [off-plan](https://mortgagelane.com/definitions#def-off-plan-mortgage) and finished, including [shared ownership](https://mortgagelane.com/definitions#def-shared-ownership) and [section 106](https://mortgagelane.com/definitions#def-section-106-agreement) homes. ## What lenders class as a new build Lenders use different definitions of a new build. A home may fall within their new-build criteria because it has never been occupied, is being sold by the developer for the first time, or was completed within the lender’s specified period. Ask which definition applies before relying on a loan-to-value limit or product. ## What is a new build mortgage? A new build mortgage is a mortgage on a newly built or converted home being sold for the first time, assessed like any residential mortgage but subject to lender rules on new build loan-to-values, incentives, warranties and offer validity. It is regulated by the FCA under [MCOB](https://www.handbook.fca.org.uk/handbook/MCOB/). England’s [Help to Buy equity loan](https://mortgagelane.com/definitions#def-help-to-buy-equity-loan) scheme closed to new applications on 31 October 2022; current routes include standard 95% lending, shared ownership and discounted section 106 homes. ## Rates **How the pricing is built:** new build mortgages are priced on lenders' standard grids by loan-to-value; some lenders cap new build flats at lower loan-to-values, which affects the rate band available. ## Criteria *Criteria* | Criterion | Value | | --- | --- | | New build houses | Up to 95% LTV with some lenders | | New build flats | Often capped lower | | Incentives | Lenders cap incentives; excess reduces the price lent against | | Disclosure | UK Finance Disclosure of Incentives Form | | Warranty | Recognised ten-year new home warranty or professional consultant's certificate | | Offer validity | Usually six months, extensions vary | | Valuation | Based on comparables, not the developer's price list | *Criteria vary by lender and must be checked for your application.* ## Incentives and the loan Developers offer incentives — cash back, paid fees, furniture, [Stamp Duty](https://mortgagelane.com/definitions#def-stamp-duty-land-tax) contributions. Lenders require them disclosed and cap them as a percentage of price; incentives above the cap are deducted from the price the lender lends against. Part-exchange and deposit contributions are treated similarly. ## Valuation and warranty New homes often sell at a premium that the second-hand market does not support, so valuers look at comparable resales and may down-value. Lenders usually require a recognised ten-year warranty. Some accept a professional consultant’s certificate for certain properties; it is not equivalent insurance cover and acceptance must be checked. ## Timing the mortgage - **Reservation** — fee paid; [exchange](https://mortgagelane.com/definitions#def-exchange-of-contracts) expected within a set period, often 28 days. - **Exchange** — mortgage offer needed; completion on notice when the home is finished. - **Offer validity** — usually six months; long builds need lenders with longer validity or extensions. - **[Completion notice](https://mortgagelane.com/definitions#def-notice-to-complete)** — typically ten working days once the home is ready. See [mortgage declined after exchange](https://mortgagelane.com/mortgages/mortgage-declined-after-exchange) on offer expiry risk. ## How it works 01 ### Step 1 Development and price reviewed; incentives listed. 02 ### Step 2 Lender chosen for loan-to-value, incentive cap and offer validity. 03 ### Step 3 Application, valuation and offer before exchange. 04 ### Step 4 Exchange; offer kept live to completion. 05 ### Step 5 Completion on notice. ## Incentives and valuation: the arithmetic **An illustrative £350,000 new build house with £17,500 of incentives (5%), bought with a 5% deposit.** ### Illustrative figures *Incentives and valuation: the arithmetic* | Scenario | Price lent against | Loan at 95% | Effect | | --- | --- | --- | --- | | Lender incentive cap 5% | £350,000 | £332,500 | Incentives within cap | | Lender incentive cap 3% | £343,000 (£7,000 excess deducted) | £325,850 | £6,650 more cash needed | | Valuation at £335,000 | £335,000 | £318,250 | £14,250 more cash needed | *Illustrative; incentive caps and loan-to-values are illustrative assumptions. Not an offer of finance.* ### What decides the case Disclose every incentive, check the lender's cap and new build loan-to-value, and allow for a valuation below the price list. **Related reading:** [first-time buyer mortgage guide](https://mortgagelane.com/guides/first-time-buyer-mortgage-guide); [section 106 mortgages](https://mortgagelane.com/mortgages/section-106-mortgages); [shared ownership mortgages](https://mortgagelane.com/mortgages/shared-ownership-mortgages). ## Sources and further guidance - [Help to Buy application closure in England](https://www.gov.uk/government/publications/help-to-buy-equity-loan-2021-2023-funding-administration-agreement/help-to-buy-equity-loan-2021-2023-homebuilder-briefing-applications-closedown-accessible-version) [UK Finance: professional consultant’s certificates](https://lendershandbook.ukfinance.org.uk/pcc) explains the certificate and its limits. ## Related mortgages and guides ## Mortgage calculator Illustrative estimates only. Use the lender’s proposed figures; this calculator does not assess eligibility or guarantee an offer. Explore your borrowing Start again Enter your figures in pounds. Your estimate updates as you go. Indicative maximum loan \- Enter your figures to see an estimate. Loan to value [Discuss your options](https://mortgagelane.com/contact) Indicative estimate only, subject to lender criteria and valuation. This is not a mortgage offer. Your property may be repossessed if you do not keep up repayments. ## New Build Home Mortgages FAQs **Q: What is a new build mortgage?** faq-id: guides-residential-new-build-mortgages-what-is-a-new-build-mortgage A new build mortgage is a residential mortgage on a newly built or converted home sold for the first time, assessed like any mortgage but subject to lender rules on new build loan-to-values, incentives, warranties and how long the offer lasts. **Q: How much deposit do I need for a new build?** faq-id: guides-residential-new-build-mortgages-how-much-deposit-do-i-need-for-a-new-build Some lenders lend up to 95% on new build houses, so a 5% deposit can be enough, while new build flats are often capped at lower loan-to-values, needing a larger deposit. Lender policies vary. **Q: Why do lenders restrict new build flats?** faq-id: guides-residential-new-build-mortgages-why-do-lenders-restrict-new-build-flats Lenders restrict new build flats because of concentration risk in large blocks, the new-build premium and resale values. Many cap the loan-to-value lower than for new build houses or resale flats. **Q: Is Help to Buy still available?** faq-id: guides-residential-new-build-mortgages-is-help-to-buy-still-available England’s Help to Buy equity loan scheme closed to new applications on 31 October 2022. Schemes elsewhere in the UK differ. Current routes for new build buyers include standard 95% mortgages, shared ownership, discounted section 106 homes and developer or industry schemes where available. **Q: Can first-time buyers get new build mortgages?** faq-id: guides-residential-new-build-mortgages-can-first-time-buyers-get-new-build-mortgages First-time buyers can get new build mortgages, often with 5% deposits on houses, and may use shared ownership or discounted section 106 homes. First-time buyer Stamp Duty Land Tax (SDLT) relief applies as for other homes. **Q: How do developer incentives affect my mortgage?** faq-id: guides-residential-new-build-mortgages-how-do-developer-incentives-affect-my-mortgage Lenders require developer incentives to be disclosed and cap them as a percentage of the price; incentives above the cap are deducted from the price the lender lends against, which can increase the deposit you need. **Q: What is the Disclosure of Incentives Form?** faq-id: guides-residential-new-build-mortgages-what-is-the-disclosure-of-incentives-form The Disclosure of Incentives Form is a UK Finance standard form completed by the developer, setting out the price and every incentive offered, so the lender and valuer can assess the true price of the new home. **Q: Do cashback and paid fees count as incentives?** faq-id: guides-residential-new-build-mortgages-do-cashback-and-paid-fees-count-as-incentives Cashback, paid legal fees, Stamp Duty contributions, furniture packs and similar offers all count as incentives and must be disclosed. Lenders treat them as reducing the effective price. Undisclosed incentives can lead to a withdrawn offer. **Q: Is part exchange treated as an incentive?** faq-id: guides-residential-new-build-mortgages-is-part-exchange-treated-as-an-incentive Part exchange, where the developer buys your existing home, is disclosed to the lender, and any amount above your home's [market value](https://mortgagelane.com/definitions#def-open-market-value) may be treated as an incentive affecting the price lent against. **Q: Why are new builds often down-valued?** faq-id: guides-residential-new-build-mortgages-why-are-new-builds-often-down-valued New homes often include a premium over comparable resales, and valuers base their figure on [comparable sales](https://mortgagelane.com/definitions#def-comparable-evidence) rather than the developer's price list, so valuations can come in below the price. **Q: What warranty does a new build need for a mortgage?** faq-id: guides-residential-new-build-mortgages-what-warranty-does-a-new-build-need-for-a-mortgage Lenders usually require a recognised ten-year new home warranty. Some accept a professional consultant’s certificate, which offers different protection and is not a substitute accepted by every lender. The conveyancer checks the warranty cover note before completion. **Q: What is the New Homes Quality Code?** faq-id: guides-residential-new-build-mortgages-what-is-the-new-homes-quality-code The New Homes Quality Code sets standards for registered developers' sales, build quality and after-sales service, with complaints handled by the New Homes Ombudsman Service where developers are registered. Buyers should check whether their developer is registered. **Q: Should I get a snagging survey?** faq-id: guides-residential-new-build-mortgages-should-i-get-a-snagging-survey A snagging survey identifies defects before or soon after completion so the developer can fix them under its obligations. It is separate from the [mortgage valuation](https://mortgagelane.com/definitions#def-mortgage-valuation), which does not inspect for defects. **Q: How long does a new build mortgage offer last?** faq-id: guides-residential-new-build-mortgages-how-long-does-a-new-build-mortgage-offer-last Mortgage offers usually last around six months, and some lenders offer longer or extensions. If the build runs late, an offer can expire before completion, so lender choice matters for off-plan purchases. **Q: What happens if my offer expires before completion?** faq-id: guides-residential-new-build-mortgages-what-happens-if-my-offer-expires-before-completion If an offer expires before completion, the lender may extend it, sometimes with fresh checks, or a new application may be needed. After exchange you are bound to complete, so expiry is planned for early. **Q: Can I buy a new build off-plan with a mortgage?** faq-id: guides-residential-new-build-mortgages-can-i-buy-a-new-build-off-plan-with-a-mortgage You can buy off-plan with a mortgage, exchanging before the home is finished, but completion may be many months away. Choosing a lender with a long offer validity, or planning to reapply, avoids gaps. **Q: How long do I have to exchange on a new build?** faq-id: guides-residential-new-build-mortgages-how-long-do-i-have-to-exchange-on-a-new-build Developers usually set a deadline to exchange after reservation, often around 28 days, which requires a mortgage offer quickly. Having a [decision in principle](https://mortgagelane.com/definitions#def-agreement-in-principle) before reserving helps meet it. Missing it can mean losing the reservation. **Q: What is a notice to complete on a new build?** faq-id: guides-residential-new-build-mortgages-what-is-a-notice-to-complete-on-a-new-build Once the home is finished, the developer serves notice to complete, typically giving about ten working days. Your mortgage offer and funds must be ready to complete within that period. **Q: Do I pay Stamp Duty on a new build?** faq-id: guides-residential-new-build-mortgages-do-i-pay-stamp-duty-on-a-new-build Stamp Duty Land Tax (SDLT) applies to new builds on the same bands as other homes, including first-time buyer relief, and is charged on the price paid. Developer contributions to Stamp Duty are incentives that must be disclosed. **Q: Can I get a buy to let mortgage on a new build?** faq-id: guides-residential-new-build-mortgages-can-i-get-a-buy-to-let-mortgage-on-a-new-build [Buy to let](https://mortgagelane.com/definitions#def-buy-to-let-mortgage) mortgages are available on new builds, with some lenders restricting new build flats or capping loan-to-value. Rent is assessed on achievable market rent for the new home. ## Reserving a new build? Get in touch with the development, price, incentives and expected completion, and we will choose a lender whose offer lasts and whose rules fit. Let’s talk property finance ## Contact us **Call our team:** [+44 333 231 8206](tel:+443332318206) **Email us:** [enquiries@mortgagelane.com](mailto:enquiries@mortgagelane.com) **Opening hours:** Monday to Friday, 9am–6pm Closed Saturday and Sunday Your enquiry goes to our team, who will get in touch to discuss your next steps. 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