First-Time Buyers
New Build Mortgages: A Complete Guide
You can buy a new-build house with a 5% deposit through some lenders, but flats often need 10% to 15% or more. The biggest new-build risks are timing, valuations and incentives, so plan the mortgage before you reserve.
Written and reviewed by Davi Thakar, CeMAP qualified mortgage and protection adviser Updated
New-build homes come with modern energy efficiency, a warranty and often a chain-free purchase. Mortgages on them work like any other, but lenders apply a few extra rules because new builds can sell at a premium that may not hold when you come to resell.
How much deposit do you need for a new build?
| Property | Typical minimum deposit | Why |
|---|---|---|
| New-build house | 5% to 10% | Some lenders offer 95% mortgages on new houses, often through the Mortgage Guarantee Scheme or Deposit Unlock |
| New-build flat | Often 10% to 15%, sometimes more | Lenders are more cautious about new flats, particularly in large developments |
Each lender also limits how much of its lending can sit in one development, so on big sites you may find fewer lenders available. A bigger deposit widens your choice and can protect you if the valuation comes in low.
Developer incentives and the price a lender uses
Developers often offer incentives such as paying your Stamp Duty or legal fees, cashback, furniture packs or deposit contributions. The developer must declare them on a Disclosure of Incentives form that goes to your lender.
Lenders usually accept incentives up to a set limit, commonly around 5% of the price, though it varies. Anything above that may be deducted from the price the lender uses to calculate your loan, which can increase the deposit you need. Ask us to check the incentives before you reserve.
Timing: the biggest new-build risk
Many new builds are sold off-plan, before they are finished. That creates timing pressure:
- Reservation. You pay a reservation fee, often non-refundable, and the developer gives you a short window to get a mortgage offer and exchange, commonly around 28 days.
- Offer validity. Most mortgage offers last about six months. Some lenders allow longer for new builds or will extend. If the build is delayed beyond your offer, you may need a new application, possibly at a different rate.
- Exchange before completion. You may exchange contracts and pay your deposit months before the home is finished. Check what happens if completion is delayed.
When your rate is fixed, your monthly payments start after completion, when the mortgage funds are released.
Schemes that can help with new builds
- Deposit Unlock. On homes from participating developers, eligible buyers can purchase with a 5% deposit. The developer pays for insurance that protects the lender.
- Mortgage Guarantee Scheme. Supports lenders offering 91% to 95% mortgages on new and older homes.
- Shared Ownership. Many Shared Ownership homes are new builds. See our Shared Ownership guide.
- First Homes. Discounted new-build homes, where your council still offers them.
- Help to Buy Wales. Still open in Wales for new builds up to £300,000, with applications by 31 March 2027. See our Help to Buy guide.
- Your First Home. A proposed new-build equity loan scheme for England announced in September 2026, not yet open.
What to check before you buy
- The warranty. Most new homes come with a structural warranty, typically 10 years, from providers such as NHBC, Premier Guarantee or LABC. Lenders normally require one.
- The New Homes Quality Code. Developers registered with the code must meet standards on sales practices and after-sales service, and you can complain to the New Homes Ombudsman.
- Leasehold and estate charges. Many new flats are leasehold, and some new houses carry estate management charges for roads and open spaces. Read our leasehold mortgage guide.
- The developer’s recommended broker or solicitor. You are free to choose your own. Independent advice means the adviser works for you, not the sale.
- Snagging. Arrange a snagging inspection before or soon after completion so defects are fixed under the warranty.
Getting a new-build mortgage, step by step
- Agreement in principle before you reserve, so you know your budget.
- Reserve the plot and send the reservation form and incentive details to your adviser.
- Full application and lender valuation, which may be based on comparable new homes nearby.
- Mortgage offer, checking the expiry date against the expected completion date.
- Exchange once your conveyancer is satisfied, paying your deposit.
- Completion when the home is finished, and the mortgage funds are released.
New build mortgage FAQs
Can I get a 95% mortgage on a new build?
On many new-build houses, yes, through lenders using the Mortgage Guarantee Scheme or Deposit Unlock. New-build flats usually need a bigger deposit.
Is it harder to get a mortgage on a new build?
Not necessarily, but lenders apply extra rules on deposits, incentives and how much they lend in one development, and timing can be tighter.
What happens if my mortgage offer expires before the build is finished?
Some lenders will extend the offer, often subject to fresh checks. If not, you may need a new application, possibly at a different rate. Check the offer expiry against the expected completion date before exchanging.
Do developer incentives affect my mortgage?
They can. Lenders usually accept incentives up to a limit, commonly around 5% of the price. Above that, the lender may reduce the value it uses, which can increase the deposit you need.
When do I start paying my mortgage on a new build?
After completion, when the funds are released and you get the keys.
Do I have to use the developer’s mortgage broker?
No. You can use any adviser. An independent broker compares lenders for you and is not tied to the sale.
Speak to us before you reserve
We can check lenders’ limits on the development, review the incentives and line up an offer that will last until completion. Your initial consultation is free, and our fee is £499 in total if you proceed.
Talk through your mortgage options
Tell us about your plans and circumstances. Your initial consultation is free.
Talk through your mortgage options
Tell us about your plans and circumstances. Your initial consultation is free.
Written and reviewed by Davi Thakar
Director & Senior Mortgage Broker
CeMAP Qualified Mortgage and Protection Adviser
Davi founded Option Finance with a vision to deliver transparent mortgage advice from a wide panel of lenders. With over 10 years in financial services, he specialises in complex cases including adverse credit, self-employed borrowers with limited trading history, and large buy-to-let portfolios. He works directly on complex cases and explains each option clearly.
Meet Davi Thakar
