The term ‘non-standard construction’ covers a wide range of property types, from listed buildings, prefabricated steel builds, properties with concrete or glass walls, or those with thatched or eco-friendly roofing - and everything in between.
It can be a little more difficult to secure a mortgage on any property that falls outside the definition of a ‘standard construction’ type, and borrowers may need to enlist a specialist lender. So if you have your heart set on a home that’s a little bit different, continue scrolling.
This guide explains which constructions are classified as ‘non-standard’, how these mortgages work, the different types available, and how to find a suitable lender offering competitive rates for your circumstances.
What is the definition of a non-standard construction?
The definition of a ‘standard construction’ is a property built of brick stone or concrete, with slate or tiled roofing. Any property that falls outside of this category is classified as a ‘non-standard’ construction type where mortgage providers are concerned.
What properties do non-standard construction mortgages cover?
A property can be classified as non-standard as a result of its structure, framework, roof, or the materials it’s made from.
Non-standard construction frames
Timber frames were popular in the past given that they can be prefabricated and made to order, therefore saving on construction time. But timber frames and roofing are still used to this day, and are typically associated with country houses, barn conversions and legacy self-builds.
However, timber is combustible and poses a fire hazard, and the structural support is also not as strong as that offered by its metal counterparts, which can result in cracking over time with increased load.
Steel frames are far stronger than timber ones, and were previously used in property development due to their agility, lightweight, easy setup and most importantly their affordability.
Combining steel frames with asbestos was also a common construction method, which no longer meets health and safety regulations. Steel also conducts both heat and cold, which presents a fire hazard.
Prefab non-standard structures
After the war, a huge number of houses needed to be rebuilt in record time. This resulted in fast, modularised construction and assembly wherever possible, often at a prefabricated unit or a construction site itself.
While this method was much-needed during those times, the lack of skilled resources required for the refurbishment means that such builds do not meet today’s safety standards.
Many houses were also built with concrete to address the post-war housing shortage, often in a factory from pre-formed, precast sections. There are two types of concrete prefabs to be aware of:
Poured concrete structures: concrete is poured into wooden moulds reinforced with steel wires.
Many of these builds become victims of ‘concrete cancer’, which is caused by elements within the concrete mix creating rust on the reinforced metal rods, which can weaken the structure and result in collapse.
Pre-formed concrete structures: concrete blocks are prepared in a factory and reassembled onsite as required.
While many mortgage providers shy away from houses made with poured concrete, some will consider lending on properties made from the more reliable pre-formed concrete structures.
Non-standard construction roofing
Flat roofs, or roofs that come with a very slight pitch, can be aesthetically pleasing and allow for more effective use of internal space, as opposed to most modern-day sloped roofing.
However, the flat design can result in water drainage issue which can be off-putting for mortgage providers and insurance companies.
Shingles are small tile strips, flat and rectangular in shape, which are laid in an overlapping format from the bottom edge up to the top of a roof. They can be made of either slate, metal, wood, plastic, cement or asbestos.
While they are an affordable roofing option, they can be difficult to maintain and can present a multitude of problems depending on what material(s) they’re made from.
Non-standard construction materials
Clay lump was very popular in 1700 - 1900 Norfolk, and is a form of earth construction made from clay-rich materials.
Many clay lump builds haven’t withstood the Test of time very well, and many of those remaining have been patched together with more modern materials, such as cement and brick.
Wattle and daub
Another technique popular in historic Britain, whereby a wooden lattice of wooden strips is ‘daubed’ over with a sticky substance composed of natural materials such as soil, sand and straw.
While this type of construction method provides good insulation, the materials can quickly deteriorate after regular exposure to rain or damp.
Cob and clunch
Cob and clunch are two more naturally-occurring materials which have been widely used in the past for non-standard UK constructions.
Cob is made from subsoil, water, fibrous organic material, and occasionally lime. Clunch is made of chalky limestone rock.
It can be difficult to find mortgage providers for either build types, but cob-based constructions are considered the stronger and sturdier of the two, and has recently been revisited as a green building technique.
K-LATH has become the generic term to describe using reinforced mesh to support cladding and stucco walls.
Drywall panels have long replaced lath and plaster, which is prone to cracking and requires ongoing maintenance.
Can I get a mortgage on an unusual property type?
Yes, it’s very possible to get a mortgage on an unusual property, but you may need to approach a specialist lender.
Every mortgage provider works to different eligibility criteria, and because the term ‘non-standard construction’ covers such a vast array of different property types, it’s impossible to say which lender is most likely to approve your application before knowing the particulars.
For instance, some lenders may consider lending subject to the outcome of a valuation, whereas others may require you to meet enhanced affordability requirements or maintenance clauses within the mortgage terms. Others will flat-out refuse to lend on any property that falls within the non-standard bracket.
Categorising things into ‘standard’ and ‘non-standard’ is a way for lenders to mitigate their risk, so finding a suitable one will be dependent on just how risky an investment the property you want to buy is, according to their eligibility rules.
Why is it more difficult to get a non-standard construction mortgage?
For mortgage providers, the decision to lend is determined by the perceived risk both the buyer, and the property itself, poses.
There are a plethora of different risks that could be associated with a non-standard construction; health and safety, strength and durability, fire hazards, susceptibility to water damage or flooding - to name a few.
Each lender will take a different stance depending on the perceived risk associated with your specific property, which can significantly limit your options and make it more difficult knowing who to approach.
More broadly speaking, non-standard properties are less sought-after, which automatically moves them into a higher risk category. The reason being that if you default on your repayments and your lender is forced to repossess your home, they could have difficulty recouping their losses and finding a willing buyer.
Unlike more modern builds, it’s also common for non-standard constructions to depreciate in value over time. This can be an added concern for lenders, who may balance this out by imposing stricter income requirements that are sufficient to cover ongoing maintenance costs, as well as the monthly repayments.
Of course, this can make it more difficult for prospective borrowers to pass the eligibility checks, which may also present additional, more stringent criteria than you might expect from a standard mortgage.
What are the eligibility requirements for non-standard construction mortgages?
While non-standard construction mortgages aren’t necessarily more expensive than standard ones, you may be more restricted by choice of lenders and suitable mortgage products, which can impact how competitive the rates you’re offered are.
Most lenders ask for a minimum of 10 - 15% deposit to secure a standard residential mortgage, but requirements for non-standard constructions may be higher - often around 75 - 80% LTV (20 - 25% deposit).
Since unique property types usually present an added element of risk, paying a higher deposit can provide lenders with extra assurance and may unlock more competitive interest rates, which will make your mortgage cheaper in the long-run.
Income and affordability
As covered, if your property requires a certain level of upkeep in order to maintain its value, maintenance will be a big consideration for mortgage providers, which will be reflected in the income and affordability requirements.
Income multiples are often used to base mortgage lending, with most providers capping at 3.5 - 4.5 times borrowers’ annual earnings. Depending on the risk involved, lenders may reduce this borrowing limit further, or / and have minimum income requirements in place.
Lenders assess your affordability by calculating your debt-to-income (DTI) ratio. A DTI of 36% or below is generally seen as ‘healthy’, but non-standard construction mortgage lenders may request a DTI of 30% or below, which demonstrates a high level of disposable income.
In the same way unique property types can present an added level of risk to mortgage providers, the same is true of bad credit applicants.
If you have a poor credit score or a history of adverse, lenders may either refuse your application or attach stipulations to their terms. That being said, most lenders are happy to consider the ‘bigger picture’ before coming to a decision.
While there are bad credit lenders out there, it may be tricky to find one that specialises in providing mortgages for both non-standard property types and bad credit applicants, so it’s advisable to ask a broker which lender is best placed to approach given your specific circumstances.
Given that your income tends to go down and you become more susceptible to poor health after retirement age, many lenders have maximum age limits for when you can take out a mortgage, and how old you are when you finish repaying it.
While there are a number of specialist mortgage products for older borrowers, you may be even more limited in choice of lenders that cover the over 55s as well as non-standard construction properties.
What else do I need to know about non-standard construction mortgages?
Before you set your heart on a property, there are a number of other considerations to be mindful of before committing to buy a non-standard construction.
A property valuation can make all the difference
Property surveys aren’t mandatory house-buying requirements, but with non-standard constructions, a full and comprehensive survey is almost a given - for the benefit of both the borrower and lender.
If mortgage providers are unfamiliar with the type of property in question, they are likely to determine eligibility on a case-by-case basis. Given that many aspects may fall outside their usual areas of expertise, they will look to the valuer to provide them with additional information on which they can weigh up the risk and make a decision.
As the borrower, you will be provided with valuable information concerning the property’s condition, as well as estimations on the ongoing costs of maintenance and repairs. If these figures are unviable, you have the option to back out of the deal before it’s too late.
Maintenance costs can be significant
As covered, non-standard properties often require ongoing maintenance in order to keep them liveable, and to retain their value. It’s all very well having your heart set on a thatched cottage, but if you can afford to maintain it you might have to have a rethink.
A property valuation should give you a rough idea as to how much you can expect maintenance costs to set you back, and the maintenance history will be a good indicator as to what problems may arise in the future.
Can ‘non-standard’ become ‘standard’?
In some cases, it may be possible to modify an element of your property to either reduce the risk associated with them, or move it out of the ‘non-standard’ category altogether.
This will be easier for some properties than others, and it all depends on which part(s) are classified as ‘non-standard’ and whether you have the funds available.
For example, you might choose to replace a thatched roof with tiles to reduce the fire hazard and prevent the need to have it replaced every thirty years. This won’t be a cheap job, but it could save you a lot of time and hassle in the long-run.
Future demand and resale
While the prospect of reselling doesn’t tend to be front of mind when you’re buying a new home, it’s an important consideration for non-standard constructions.
If your circumstances changed and you were in need of a quick sale, just how easy would it be to find a buyer that’s a) willing to take on the risk and maintenance themselves, and b) able to find a mortgage provider in a limited, ever-changing lending market?
What about insurance?
Just like a non-standard mortgage differs slightly from a normal mortgage, non-standard insurance will be required, which means finding specialist providers who understand the property and the risks associated.
While there are plenty of niche insurance companies out there, you may not be offered the competitive premiums you’d receive if you were insuring a standard property.
Ask a mortgage broker for advice before buying a non-standard construction
If you’re considering buying a unique property type, or you’re not sure whether the home you’ve got your eye on falls into the ‘standard’ or ‘non-standard’ category, it’s well worth speaking to a mortgage broker early on in the process.
The term covers such a huge range of builds that the only way to determine a property’s true mortgage-ability is to run through the details with an expert. We’ll be able to advise how difficult it will be to secure funding, and flag any potential risks you may not have considered.
Our team of experts have access to over 100 lenders, including specialists in non-standard constructions. We also have access to exclusive deals not available on the high street, so you can rest assured we’ll find you the most competitive rates.
Save time, money and unnecessary mortgage rejections by contacting The Mortgage Hut directly; give us a call on 02380 980304 or contact us via our online enquiry form, and a member of the team will be in touch.