How To Fund a Self Build Home

When navigating the world of self building, one of the biggest considerations is understanding how to fund a self build. Funding a self build is different to buying a regular property as there are additional stages and considerations that need to be made throughout the process that aren’t necessary for pre built homes.

Besides some obvious options such as using cash savings or selling your current home, we will explore some other financial options available when it comes to financing a self build.

Whenever considering finance options for any large project, we recommend always seeking professional advice from financial experts, such as our finance partner Windsor Hill.

Financing a Self-Build: Key Considerations

As aforementioned, there are key considerations when it comes to funding a self build. For example, cash flow is needed as part of the self build process as there will be different stages that need financing. For example, paying for materials and hiring builders and contractors throughout.

When planning to build your own home, you’ll need to take some time to properly sit down and think about everything that you’re going to need to to finance, and it’s worth conducting some proper research when doing this. Some obvious immediate considerations include land, materials, builders, planning permission and architects.

Having an idea of what your overall cost looks like is important when it comes to funding a self build so that you can accurately gauge which financing options are available to you.

funding a self build project

Self Build Mortgages

Self build mortgages are the go-to option for self build finance for people who are not funding their build using cash or by selling their home. Self build mortgages are designed with the self build process in mind.

There tend to be less of these mortgages available on the market compared to a standard mortgage, which can mean the rates are less competitive. However, they are designed in a way whereby funds are released periodically which is advantageous to the self build process and covering different stages of the build.

How do Self Build Mortgages Work?

Unlike traditional residential mortgages, self build mortgage payments are released in stages. This means that for each part of the project, from buying the land to obtaining planning permission and completing the project, the amount given by the lender increases as the value of your home increases. In some instances, it is possible that lenders can reduce the interest rates once your self build is complete as well.

There are different ways in which you can receive the money from your mortgage provider, and this will largely depend on your own personal circumstances. It’s worth speaking to an industry expert or conducting research to gain a better understanding of what is most appropriate for your self build.

Here at inCollective, we work with Windsor Hill mortgages, our finance partners and an award winning, family-run mortgage advice firm that advises anywhere in the UK. If you are interested in self build mortgages as your self build funding option, it is worth taking a look at their website and seeking their professional financial advice.

How much deposit do I need for a self-build mortgage?

This can vary from lender to lender, so it’s best to conduct thorough research to get a better indication of what deposit you will need. However, according to USwitch, many lenders expect around 25% deposit for self build mortgages.

Arrears or advance stage payments?

There are two main payment types available for self build mortgages – arrears and advance stage payments. Arrears mortgages will release the funds to you once each stage of the project is completed. For example, after your plot purchase has gone through. However, advance mortgages will release the funds to you prior to each stage of the project so that you can use that money to fund it. For example, to pay for your plot of land purchase.

We recommend speaking to our finance partners Windsor Hill Mortgages for more information on payment types.

What’s the difference between development finance and self-build mortgages?

Self-build mortgages have many similarities to traditional home mortgages. However, development finance is a completely different kind of finance option.

One of the most important key differences is that self-build mortgages are designed for individuals who plan to live in the property upon completion of the project. By contrast, development finance is more designed for residential or commercial property developers who are intending to sell the property upon completion.

Help to Build Equity Loan

The Help to Build equity loan is an additional option for funding a self build home for people in England. This is a scheme introduced by the UK government in which they offer to cover a percentage of the self build project as an equity loan in addition to your self build mortgage. According to the Own Your Home Government site, this can be anywhere from 5% to 40% depending on where you are located in the country.

The idea behind the scheme is to encourage people to build their own homes and make this type of home ownership more accessible to those who may otherwise dismiss the idea of doing so.

What is the Criteria for the Help to Build Loan?

In order to qualify for the help to build loan, there are a few criteria that you must meet to apply. This includes:

  • Being over the age of 18 and a permanent resident of England
  • Secure a self build mortgage from a Help to Build registered lender
  • You intend to live in the home once the property is built (rather than selling or letting the property).
  • Your project is up to £600,000

You can find out more about Help to Build: Equity Loan in the Government Customer’s Guide.

self build project funding

Which Self Build Finance Option is Right for Me?

Understanding your self build funding options is an important step in working out which finance option is right for you.

We encourage you to conduct thorough research and gain a thorough understanding of what is required from a self build project in order to accurately calculate your potential self build costs, or speak to a financial advisor.

Contact Us at

At, we are familiar with working on self build projects for clients throughout the UK, and therefore have a great understanding of the full process, from self build architecture through to what the requirements are for these kinds of projects. As mentioned earlier in the article, we work closely with mortgage providers Windsor Hill, who are qualified in providing expert mortgage advice.

If you have any questions or would like to chat to us, pop us an email at or head over to our online contact form.

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