New build mortgages are slightly different from traditional mortgages, just as buying a new build home is different from purchasing an older property. If you’re planning to buy a new build home in 2026, here’s everything you need to know about new build mortgages…
What is a new build mortgage?
A new build mortgage is simply a mortgage taken out specifically for a new build home. Lenders generally consider a property to be ‘new build’ if it has been built — or in some cases extensively renovated — within the last two years.
Deposits and new build mortgages
One important thing to be aware of is that lenders are often a little stricter when it comes to new build homes. This is because the value of a new build property can dip in its first year, once it’s no longer brand new, and lenders aim to protect themselves against any potential risk. As a result, you’re likely to need a larger deposit for a new build mortgage. If you’re buying a new build flat, the deposit requirement may be higher still, as lenders typically view flats as higher risk than houses.
That said, loan-to-value (LTV) ratios do vary between high street lenders, and there are
competitive deals available. It’s also worth remembering that a larger deposit means a lower LTV and a smaller amount to borrow, which can help keep your monthly repayments down.
Have an expert in new build mortgages in your corner
To help you secure the best high street deals from lenders offering new build mortgages, we
strongly recommend working with a mortgage broker who has proven experience with new build homes. A specialist broker can be invaluable. They understand the new build buying process and can tap into a wide range of suitable lenders. They’ll also know that new build properties often experience delays, and can guide you towards lenders that offer longer mortgage offer validity periods.
Timing is especially important with new build purchases. Once you’ve reserved your new build property, you usually have just 28 days to exchange contracts. Having an experienced mortgage broker on your side can make all the difference, helping you find the right lender and complete your application within the required timeframe.
The steps to a new build mortgage
Follow these key steps to understand what you should do — and when — as you work towards securing a new build mortgage…
1. Check your affordability. Start by working out how much you can realistically afford. This is
the ideal time to speak with a mortgage broker who specialises in new build homes. They can talk you through deposit requirements, highlight any schemes or deals you may be eligible for, and confirm how much you’re likely to be able to borrow.
2. Get an Agreement in Principle (AIP). Also known as a Mortgage in Principle
(MIP), this is essential when you begin viewing new build homes. If you find a property you
love and want to make an offer, developers will want reassurance that you’re in a position to
proceed. An AIP shows how much a lender may be willing to lend, based on your income,
outgoings, and any existing debts.
3. Find your home and apply for your mortgage. Ideally, by the time you find your perfect new
build home, you’ll already have an AIP in place. If not, you’ll need to act quickly. This is the stage where your full mortgage application must be submitted, so contacting your mortgage broker straight away is crucial.
4. Secure your mortgage offer. Once the lender has carried out a valuation survey and approved your application, they’ll issue your mortgage offer. With this in place, you can move forward with paying your deposit and agreeing a completion date with the developer. If delays arise, this date may be pushed back. Most new build mortgage offers are valid for between 6–9 months, although this varies by lender, with some offering up to 12 months. If your property isn’t completed in time and an extension isn’t possible, you may need to reapply. A knowledgeable mortgage broker can help navigate more complex situations, including requesting an extension if delays occur.
Be mindful of housebuilder incentives
When buying a new build home, you’ll often be offered a range of attractive ‘freebies’ from
housebuilders. Instead of reducing the asking price, these incentives may include contributions towards stamp duty, legal fees, or other costs. While these offers can be extremely helpful, it’s important to inform your mortgage lender about any incentives you receive, as they are taken into account during your mortgage application. Incentives worth up to 5% of the property value are usually acceptable. If incentives exceed 5%, the portion above this threshold may be deducted from the purchase price when calculating your mortgage. You should still receive a mortgage offer, but your LTV and mortgage rate could be affected.
As always, it’s best to discuss this with your mortgage broker as soon as you’ve found the new build home you’d like to buy, so they can guide you through your options. Start your search for a new build home in 2026 with us. Once you understand what you can afford —
with help from a mortgage broker or lender — you can confidently focus on finding the right home for you.
We list new homes for sale across the country, from major national housebuilders to smaller,
medium-sized developers. Start your search here.
