Non-Standard Construction Mortgages

This guide explains what counts as non-standard construction, how it affects your mortgage options, what lenders look for when assessing these properties and how a broker can help you navigate the smaller lender pool. Non-standard construction does not mean unmortgageable, but the property type, its condition and any remediation work that has been carried out all influence which lenders will consider the application and on what terms.

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For a free initial consultation about mortgages on non-standard properties, call 01202 155992 or contact Mortgage One.

What Counts as Non-Standard Construction

A property is classified as non-standard construction when its structural walls, roof or frame deviate from conventional brick, block or stone walls with a pitched tile or slate roof. The classification is usually identified through the property details and confirmed by the surveyor’s valuation report. Common types of non-standard construction include:

•       Timber frame. Many modern timber frame properties are now mainstream and widely accepted by lenders, particularly where they meet current building regulations and have an approved structural warranty. Older timber frame properties or those in poor condition may have a more limited lender pool.

•       Precast reinforced concrete (PRC). Post-war PRC houses, including Airey, Reema, Unity and Wimpey No-Fines types, were originally built as temporary housing. Some have been structurally repaired and issued with a PRC certificate confirming the remediation. Lenders generally require a PRC certificate before considering a mortgage on these properties.

•       Steel frame. Steel-framed properties, including BISF (British Iron and Steel Federation) houses, can be mortgageable but the lender pool is restricted. Condition and any remediation work are key factors.

•       Flat roof. Properties with a flat roof over a significant proportion of the structure are often classified as non-standard. Small flat-roof extensions on an otherwise standard property may be accepted by more lenders.

•       Thatched roof. Thatched properties are accepted by some lenders but require specialist buildings insurance, which can be more expensive. The condition and maintenance history of the thatch are important.

•       Concrete construction. Concrete panel, poured concrete and other concrete construction methods are treated as non-standard. Some concrete types are more difficult to mortgage than others, particularly if the construction is known to have structural issues.

•       Other types. Barn conversions, listed buildings, properties with significant cladding, eco-builds, modular construction and properties above commercial premises can all fall within the non-standard category depending on the lender’s definition.

Why Lenders Are More Cautious With Non-Standard Properties

Lenders assess non-standard construction properties more carefully because they present risks that do not apply to conventional brick and tile homes. The main concerns are:

•       Resale risk. Non-standard properties may be harder to sell and may appeal to a smaller pool of buyers, which increases the risk that the lender cannot recover its lending if the property needs to be repossessed and sold.

•       Structural uncertainty. Some non-standard construction types have known issues, such as corrosion in steel frame properties or carbonation in concrete panel homes. The surveyor’s report is critical in determining whether the property is acceptable.

•       Insurance. Buildings insurance for non-standard properties can be more expensive or harder to obtain. The lender will require adequate buildings insurance to be in place as a condition of the mortgage.

•       Maintenance. Some non-standard features, such as thatched roofs or flat roofs, require more frequent maintenance than conventional alternatives. Higher ongoing costs can affect long-term affordability.

To discuss mortgage options for a specific non-standard property, call 01202 155992 or contact Mortgage One.

Surveys and Valuations

The survey and valuation report is the single most important document in a non-standard construction mortgage application. A standard automated valuation or drive-by inspection is rarely sufficient. Most lenders will require a physical valuation at a minimum, and in many cases a full structural survey may be advisable to identify issues that could affect the property’s mortgageability.

The valuer’s report will comment on the construction type, the condition of the property, any defects, the adequacy of any remediation work and the property’s suitability as mortgage security. For PRC properties, the lender will typically require a copy of the PRC certificate confirming the structural repair. For properties with cladding, the lender may request an EWS1 (External Wall System) form confirming the fire safety position. Mortgage One’s mortgage application guide covers the documentation and process involved in applying for a mortgage.

Deposit and Loan-to-Value

Non-standard construction mortgages often require a larger deposit than standard properties. Maximum loan-to-value ratios typically range from 75 to 85 per cent, depending on the construction type and lender. Some property types, such as unremediated PRC or properties with known structural issues, may only be mortgageable at lower LTV or may not be mortgageable at all until the issues are addressed.

A larger deposit reduces the lender’s exposure and may open up a wider range of lender options. If the property is at the margin of acceptability for mainstream lenders, moving from 80 to 75 per cent LTV can sometimes bring additional lenders into the frame.

Modern Methods of Construction

Modern methods of construction, sometimes referred to as MMC, include factory-built modular homes, structural insulated panels, cross-laminated timber and other off-site manufactured building systems. While these are technically non-standard by traditional definitions, many are now well-established and accepted by an increasing number of lenders, particularly when the property holds an NHBC or equivalent structural warranty. Mortgage One’s self-build mortgage guide covers stage payment mortgages for properties built using these methods.

As new build properties increasingly use MMC, the distinction between standard and non-standard is evolving. Lender acceptance depends on the specific system, the warranty in place and the property’s track record. Mortgage One’s new build mortgages guide explains how construction type affects new build lending.

How Mortgage One Can Help

Non-standard construction mortgages require a broker who understands which lenders accept which construction types and what documentation they need. As a whole of market mortgage broker, Mortgage One can identify lenders that are willing to consider the specific property type, assess what survey or certification is required and ensure the application is presented with the right supporting documentation.

This includes sourcing lenders for timber frame, concrete, steel frame, thatched, flat roof and other non-standard types. If you are remortgaging a non-standard property, Mortgage One’s remortgaging guide explains the process and how construction type affects lender choice on a remortgage.

For expert guidance on non-standard construction mortgages, call 01202 155992 or contact Mortgage One.

The information provided in this article is for general guidance only and does not constitute personal or regulated financial advice. If you’d like to understand what these moves could mean for you, speak to Mortgage One. We can explain your options and timings based on your specific circumstances.

Some Buy to Let mortgages are not regulated by the Financial Conduct Authority.

FAQs

1. Can you get a mortgage on a non-standard construction property?

Yes. Many lenders consider non-standard construction properties, but the lender pool is smaller and the criteria are stricter than for standard brick and tile homes. The property type, condition, any remediation and the survey report all affect which lenders will consider the application.

2. What is a PRC certificate and do I need one?

A PRC certificate confirms that a precast reinforced concrete property has undergone approved structural repairs. Most lenders require a PRC certificate before they will consider a mortgage on a PRC property. Without one, the property may be unmortgageable.

3. Is a timber frame property hard to mortgage?

Not necessarily. Modern timber frame properties built to current building regulations and covered by an approved warranty are widely accepted by lenders. Older timber frame properties in poor condition may have a more limited lender pool.

4. Do I need a full structural survey?

A physical valuation is usually required at a minimum. For non-standard properties with known structural risks, a full structural survey is advisable and may be required by the lender to assess the property’s condition and suitability as security.

5. What is an EWS1 form?

An EWS1 (External Wall System) form is a fire safety assessment for properties with cladding, typically flats in buildings over a certain height. Some lenders require an EWS1 form before they will approve a mortgage on affected properties.

6. Do non-standard properties need a bigger deposit?

Usually, yes. Maximum LTV on non-standard properties is typically 75 to 85 per cent, compared to up to 95 per cent on standard properties. A larger deposit reduces lender risk and may widen the available lender options.

7. Are modern methods of construction treated as non-standard?

Technically, yes, but many MMC building systems are now well-established and accepted by an increasing number of lenders. Acceptance depends on the specific system and the structural warranty in place.

8. Can I get a buy-to-let mortgage on a non-standard property?

Yes, some lenders offer BTL mortgages on non-standard properties, but the lender pool is smaller and deposit requirements may be higher. A broker can identify which lenders accept the specific construction type for BTL.