Non-Standard Construction Mortgage – Steel Framed

If you want to buy a home constructed around a steel frame – or you’re seeking a remortgage – it can be tricky to find a lender to accept you. We’ll help identify a mortgage that will work for you.

What is a non-standard construction mortgage?

You will usually need a non-standard construction mortgage for a home that is not made from brick or stone, or doesn’t have a slate or tile roof. These are the ‘standard’ methods of construction in the UK. 

Other types of home, including steel framed homes, concrete homes, barns and thatched cottages are considered to be of ‘non-standard’ construction.  Lenders see these types of homes as higher risk, and many won’t accept them for a residential mortgage.

Why is it hard to get a mortgage on a steel framed home?

Mortgage lenders need to have confidence in the building you are borrowing against. Ultimately, if you cannot pay your mortgage, the lender has the right to repossess the building and sell it to recover their loan. Because of this, they want reassurance that the house is structurally sound and will be easy to sell. 

In the past, some steel-framed homes became unsafe as the metal became corroded and weak. This was particularly the case in Post War ‘prefab’ homes. The issue led mortgage lenders to reject houses of this type of construction, because it affected their value.

Today, steel frame construction is much more rigorous and safe. Various mortgage lenders will accept steel framed homes, particularly those built in recent years. 

Does it matter when a steel-framed property was built?

A limited number of lenders will offer mortgages on a steel-framed construction, but many will set an age limit. Typically, homes built before 1990 won’t be covered. 

Some lenders will underwrite a mortgage based on the specific details of your property, but you may find that the rates and fees are higher than on a standard mortgage.  

What should I consider when buying a non-standard construction, steel framed house?

There is more to think about than just the mortgage when you’re looking at buying a steel framed property. Key areas that you should consider include: 

Future sale – Could it be challenging to sell the property in the future? This could delay your onward plans and cost you money while you wait. If the property has not been on the market long, that’s a good sign. But bear in mind that the older the home becomes, the greater the risk of corrosion or other structural problems becomes.

Maintenance – Will you need to find specialists to repair or maintain the property, and will this be expensive? What general tasks will you need to keep on top of to keep the home at its best? Seek advice from a construction expert. 

Insurance – Check whether it will be possible to insure the property, as many insurers set exclusions around property types. It’s a good idea to get an understanding of what your premium might cost before you commit to the purchase. 

Valuation impacts – It can be difficult to tell from a standard property survey whether there are any problems with the steel frame supporting the home. It is advisable to invest in as detailed a survey as possible, to understand if there might be any issues – so do allow for this in your budgeting. 

Is a non-standard mortgage more expensive?

You can expect to pay more for a non-standard construction mortgage, because it’s a much less competitive sector. Fewer lenders operate in this space, so it’s more about finding a mortgage to suit your situation and less about shopping around for the best price. 

That said, we work closely with the lenders that cover non-standard construction and will negotiate on your behalf to find you the right deal..

You may find that rates and fees are a little higher than on a standard mortgage. You may also have to put down a larger deposit, for example 15%-20% or more.

How can a Mortgage Broker help?

Finding an appropriate mortgage on a steel-framed home is absolutely possible, but you will need support from a professional advisor. 

We will explore all the details about your planned property purchase and personal finance situation so that we can recommend suitable options. We’re here to support you through the mortgage application, survey and legal work and answer your questions along the way.

Approved by the Openwork Partnership on 20.03.23