BuildLoan and Loughborough Building Society have launched two self-build mortgage products that feature advance and arrears stage payments.

The development and bridging finance firm for brokers says the products are available to fund self-build projects using a variety of construction types.

This includes offsite manufactured systems and a range of cladding and roofing options, as well as traditional masonry construction.

The deals do not carry early repayment charges.

The advance stage release two-year discount mortgage comes in at 4.39%, which is 0.95% less than Loughborough’s standard variable rate and has a £999 fee.

The two-year arrears stage release product is set at 4.25%, a discount of 1.09% from Loughborough’s SVR, with a fee of £999.

Deals rise to 80% of a borrower’s land and build costs and a maximum end loan to value of up to 80%. Loans range from £50,000 and £500,000. 

BuildLoan head of product development and underwriting Chris Martin says: “With these new products, Loughborough’s range of mortgages – available exclusively through BuildLoan – meet a really wide range of customer needs. 

“An increasing number of self-builders are using construction methods such as timber frame where a larger proportion of the build costs are incurred earlier in the build. 

“The advance stage payment mortgage is a fantastic solution to this as it gives the client money up-front to pay for the timber frame before it’s installed on site. 

“Because funds are released on these products based on each stage of build costs, rather than being linked to a site valuation, the risk of down valuation is also removed. 

“This gives the clients huge peace of mind that they will receive funds when they are expecting them.”

Loughborough Building Society business development manager Ashley Pearson adds: “We’ve taken the time to work together with BuildLoan to develop our products and policy to make sure they reflect what self-builders need to ensure their project is a success.”

Earlier this month, BuildLoan partnered with Nottingham Building Society to launch two loans for self and custom-build properties.