Can I get a land mortgage?
Yes. You can get a mortgage just on land.
Whether you require a mortgage for agricultural, equestrian, leisure or development purposes, Access Commercial can help you.
How much deposit will I need?
Generally you will require between 30% and 50% of the land's value. However, a 100% mortgage may be available to you if additional security can be provided.
Will the land require planning permission?
Yes. Most lenders will require the appropriate planning for your desired use. However, we do have some specialist schemes available where no planning consent is required. Contact us here or on 01202 375545 if you would like to discuss these schemes with a specialist land mortgage advisor.
How much will it cost?
Rates will vary depending on the intended use of the land, any proposed business that you may run on the and your relevant experience. They typically start from 3.5% over the current Bank of England base rate.
What charges can I expect?
There are of course charges that you must consider when entering into a commitment to purchase a plot of land. Payment will generally be required before or upon completion of your purchase so you will need to be sure that the money is available before completion. These costs are:
- A commitment/application fee – lenders and brokers may ask you to pay a fee upon application to cover any costs that might be incurred during the process. Access Commercial will normally charge £300 as a commitment fee which will be refunded by deduction from their broker fee at completion.
- A valuation fee – this will be charged by the lender or sometimes by the surveyor and will usually vary depending on the value of the plot of land.
- Legal Fees – you will need to pay your own solicitor and the lender’s solicitor. Sometimes lender’s solicitors will offer a discount if their firm works for both you and the lender. Lenders may insist that your solicitor’s firm is of a certain size (usually a minimum of 2 partners) and we strongly recommend that you employ a solicitor with specific expertise in commercial conveyancing to avoid any delays with the process.
- Stamp Duty – this will vary depending on the purchase price of the land. Click here for current fees.
- Lender fee – this may be anything up to 2% of the sum borrowed and will normally be added to the advance. Not all lenders will charge a fee.
- Broker Fee – this is the fee we would charge for arranging the loan. We usually charge 1% of the advance which becomes due when a mortgage offer is produced (although this is not normally paid until completion).
- Other Costs – other unusual costs may exist not included above, we will try where possible to identify them at the enquiry process.
Can I finance grazing land for my horses?
Yes. We have specialist lenders who can provide finance for this type of land use.
How does the application process work?
The Enquiry – you will be asked a number of simple questions so that we can understand your intentions. Amongst other information we will need to know the following:
- The purchase price of the land.
- The amount of money that you have available for a deposit.
- The intended use of the land
- Details of any relevant experience you have.
From this we will prepare an indicative illustration of costs based on our understanding of your situation and our knowledge of the lending marketplace. Please note that this is merely an illustration and may change when the application pack is received.
The application and submission for decision in principle.
We will ask you to complete an application form and to supply personal financial information plus any specific information that may apply as a result of our enquiry conversation. This will form the basis of our report to Lenders from which an agreement in principle can be given. This agreement is subject to the valuation of the land and to the lenders final checks.
Facility (offer) letter.
Once the valuation has been approved a formal letter will be issued detailing the terms that the lender will apply in lending you the mortgage funds. At his point, or shortly thereafter, legal documents will be issued to your solicitor who can then arrange exchange of contracts and completion.
How long will the process take?
In theory the process is not a long one, but in practice there are many factors which can cause a delay. The main area of potential delay is the legal process and here it is very important that you choose a solicitor who is experienced in commercial conveyancing.