BuildLoan has launched two new low-fee products in conjunction with the Hinckley & Rugby Building Society.

Both offer BuildLoan’s guaranteed stage payments, linked to the cost of each stage of work, without the usual indemnity fee associated with these features.

The two-year discounted products offer an ERC-free option with an initial rate of 4.50% or a two-year ERC option with a lower initial rate of 3.99%.  Both products have an application fee of £199 and a completion fee of £800.

Funds are released in stages as the build progresses, with the pattern of releases agreed at application, meaning clients can know when they will receive funds and can plan their build accordingly.

BuildLoan head of product development and underwriting Chris Martin says: “We know self builders incur a lot of costs before they’ve even started their project and these products offer an option to reduce the fees for setting up the finance for their build, but still getting the benefit of the guaranteed stage payments our products offer.”

Hinckley & Rugby Building Society’s head of mortgage proposition & distribution Carolyn Thornley-Yates adds: “By reducing the cost of setting up the mortgage but keeping the features that give borrowers the peace of mind to progress their build with confidence, we are making the option of self build much more attractive.   

“It’s vital that brokers look very carefully at the features of any self build product – many other products rely solely on valuations during the build to determine the funds made available to the client – this can mean the client gets less than they expect and risk the build coming to a standstill.”