Read more in Ecology's recent press release:
Ecology expands offering for unique off-site construction mortgages Society adds more suppliers after successful launch earlier this year
Ecology Building Society is supporting more borrowers who want to build their own homes after successfully launching a unique mortgage earlier this year.
The mutual was the first UK lender to introduce dedicated mortgages for off-site construction homes, where modular sections of a property are made indoors in a factory and assembled on-site. The technique is sometimes called Modern Methods of Construction (MMC).
It was also the first lender to offer its mortgages in partnership with leading modular construction manufacturers. The lender is now working with seven businesses across the UK and is seeking further partners from the modular construction industry.
Borrowers can choose from two different Ecology Products:
- Off-site Build mortgage, with staged release of funding as the project progresses; and
- Off-site Build mortgage (Advance Payments) where a portion of the mortgage advance can be secured against the modular components before construction starts.
At the end of their build, borrowers can benefit from Ecology’s unique C-Change discount, which reduces their variable mortgage rate by up to 1.50% in recognition of the work they’ve completed to cut their carbon footprint.
“More than half of all self-builders use off-site construction* so we wanted to develop mortgages which specifically supported this growing group of borrowers,” said Dan Capstick, Ecology Building Society’s Mortgage Product Manager.
“With that in mind, we created the unique Advance Payments option, as we understand this type of self-build can have high upfront costs to buy the modular kit, just at a time when homebuyers may have spent much of their savings on buying the land, planning costs and utility connections.
“Finding a site is the biggest challenge facing self-builders but managing cash flow during the project can be daunting so we looked at ways we could ease this process for borrowers during their build.
“Working with the modular construction suppliers through our Off-site Build mortgages potentially opens up self-build to more borrowers who might have thought this wasn’t possible for them.
“We also hope our innovation in this sector will support moves to scale up modular construction, which could help to deliver more homes more quickly to reduce the UK’s housing shortfall.
Off-site construction offers the opportunity to build high-quality homes to a more consistent standard, which also are more energy efficient. Construction has a lower carbon footprint, generally takes less time than a conventional building and creates less waste.
“We’ve been at the heart of the SIPs industry for the past 20 years and we are mindful of the difficulties that some self-builders experience with funding their projects and accessing cash through traditional mortgages.
“As such, we’re delighted to become one of Ecology’s selected partners and to be able to confidently point our customers to a lender whose specialised products are uniquely tailored to the off-site construction sector.”
Ian Clay, Founding Partner, SIPS@Clays
*2022 report, NaCSBA, the National Custom & Self Build Association
Ecology Building Society
Ecology Building Society was founded in 1981 to build a greener society, challenge the norm and agitate to change finance, principles still guiding every decision to this day.
Through impact-led lending, it supports green new homes and self-build, the conversion and improvement of existing buildings, and schemes to bring disused and derelict properties back into sustainable use. Ecology also lends to small-scale green developers, sustainable businesses, community groups and community-led housing.