How & Can I Get a Mortgage for a Barn Conversion?

July 13, 2021
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If you've been dreaming of purchasing a run-down property and converting it into a stunning residential home, you're in the right place. Mortgage customers looking to explore their mortgage options should consider a barn conversion mortgage. 

This type of mortgage can be used to finance the purchase of land and the construction of buildings on that property. However, it is available only to those with sufficient liquidity and good credit, so it is not something everyone will qualify for right away.

The blog post will provide more detailed steps about how mortgage customers can get this type of mortgage from their bank or lending institution.

For more advice and support on building your dream property, Niche Mortgage Info can help. We're experts in non-standard mortgage applications, so you know you're in good hands.

Mortgage for a barn conversion: What you need to think about

There's no denying the charm of a barn conversion. High ceilings, original features and plenty of space for a growing family are often top of the list for many house hunters. But this isn’t the only thing you need to consider.

You'll need to think about the following factors before you can move forward with your plans:

  • Planning permission. Do you need it, and how can you go about getting it?
  • Surveys. What do you need for the project, how do you get them?
  • Access and right of way. If your barn is located on farmland, can you secure access?
  • Is the property a listed building? Can you renovate it within the requirements?
  • Where do you plan to live while work is taking place? Can you afford a second home or will you live on-site?
  • What is your budget, and can it cover all of your costs, even with some unexpected expenses along the way?

Let's dig a little deeper and look at each of these factors in turn.

Do you need planning permission before you can secure a mortgage?

The short answer is no. Changes in the guidelines mean that you no longer need full planning permission to secure a mortgage for a barn conversion. In 2014, the government relaxed the rules to allow interested parties to purchase agricultural buildings with the intention of converting them into residential dwellings.

We know many customers are in a hurry to secure their mortgage and start work on their barn conversion project as soon as possible, so this distinction may come as good news.

You will need to give the local authority something called "prior notification" before any work can get started. This is typically accepted but could be rejected if any requirements are not met. Your solicitor can verify this during the conveyancing stage if you have your doubts.

When do I need planning permission?

Planning permission is required if you are converting a barn or other agricultural building into an individual dwelling if the conversion is classed as a re-build. There are many different rules to follow with regards to a conversion versus a rebuild. (Source)

The best way to work around these rules is to consult with an architect who specialises in barn conversions. They will guide you on the specifics that need to be met to avoid the need for planning permission.

For example, if you are planning to extend the building significantly, this would need planning permission. There could also be differences in local authority rules about what constitutes a rebuild and a conversion. This is why local support is essential.

What surveys are required for a barn conversion?

Before undertaking any barn conversion project, a structural and full building survey would be required. Structural surveys can determine the properties of how well the structure is holding up in addition to its overall condition.

If you have doubts about this step, it's always best to consult with a chartered surveyor before moving forward.

Are there any agricultural restrictions?

Before buying a barn to convert, it's important to know whether there are any agricultural constraints on the land that would prevent you from getting standard mortgage approval. If such restrictions are in place, this could reduce the number of lenders you can approach and make it more challenging to secure a mortgage.

Do you have access and right of way?

Before making an offer on any property, always check the property boundaries and ensure you have access and the right of way. If you do need to arrange access, this is another step that needs to be approved by the local authority. Again, your architect should be able to help confirm this.

What if the barn is a listed building?

If the barn is protected by the national heritage authority, there will be special rules you need to follow when renovating. Before you apply for a mortgage to fund your barn conversion, consider getting professional advice on the proposed plans. You may need to apply for something known as "Listed Building Consent".

Listed building consent is applied for at the same time as planning permission or prior notification. It should include detailed plans and drawings outlining the proposed work. There may be restrictions on materials you can use or requirements for hiring specialist labour.

The good news is that buildings that retain their listed status will maintain a higher value than non listed buildings.

Where will you live while work is ongoing?

An extensive renovation can take months, if not years, so you'll need somewhere to live in the meantime. Make sure you include this in your budget, as most mortgage providers will want to see that you have budgeted for living costs during the renovation.

Will your budget cover the renovation and unexpected surprises?

The last thing a lender wants to see is a mortgage applicant running out of money part-way through a renovation and being unable to repay the mortgage. This will leave the lender with a partially finished project, which will make it harder to recoup their costs.

Lenders will typically ask to see a detailed budget with quotes from suppliers and professionals. You should also include provisions in your budget to ensure unexpected expenses don't push you off course.

If any of the above sounds too daunting, don't worry. It isn't as complicated as it seems once you get the ball rolling on your project. Our team can help put you in touch with a broker who can help guide your project into the arms of the right lender.

Is it possible to secure a mortgage for a barn conversion?

Absolutely! It is possible to secure a mortgage for a barn conversion, but the path may be quite different to that of someone buying a ready-built residential property. It might take a little more time and research to find the right lender for your needs.

Typically, lenders will only provide a mortgage for a property that is ready to be lived in. So a run-down barn with plenty of potential might not make the cut with most lenders. However, there is lending available that would release the mortgage in stages.

This type of mortgage is called a self-build mortgage, and it is ideal for this purpose. As you can probably guess from the name, self-build mortgages are aimed at anyone building a property from scratch or converting a property into a residential property. This includes barn conversions.

Unlike a traditional mortgage that will release the funds all at once, a self-build mortgage releases the funds in stages to allow work to continue moving forward without putting the lender at higher risk. For a barn conversion, the stages typically include:

  • Purchase of the land and barn
  • Foundations and structural renovation
  • Eaves height completion
  • Watertight roofing
  • Internal fixtures

To make the most of this mortgage type, you would need to plan your renovation carefully to manage your budget and make sure you can progress to the next stage.

How do I get a self-build mortgage for a barn conversion?

If you are considering a mortgage for your self-build project, we can help. Call us today on 0330 880 0147 or use our enquiry form to contact our mortgage consultants and get the ball rolling.

We offer mortgage advice and guidance from expert advisers who know all about what it takes to finance property development projects, including barn conversions and self-build mortgages.

Is there another way to get a barn conversion mortgage?

Self-build mortgages are the most common route for anyone looking for a band conversion mortgage, but they are certainly not the only option. There are some circumstances where a self-build mortgage would not be appropriate.

  • If you are purchasing a barn at auction, you would need the total sum within 28 days, so a self-build mortgage would not work in this instance. You might not have enough time to complete your mortgage application.
  • If you are planning to renovate and sell the barn, short-term financing might e more useful.
  • If the level of work required to renovate the barn is extensive, you might struggle to secure a self-build mortgage.
  • Short-term funding would be more appropriate if you have the financing to purchase the barn and land but simply need money for the renovation.

In all of these situations, a bridging loan would be advisable. A bridging loan is a loan with a very short term, typically of one year or less. However, some lenders will stretch this to 36 months in exceptional circumstances.

The mortgage lender may charge an interest rate that is higher than for the mortgage you are applying for, but this can still be very beneficial if it means getting your project off to a good start and giving you time to find more permanent funding, either through another mortgage or by selling the property.

You need to have a clear exit strategy for a bridging loan. This would either include selling the property once it is completed or switching to a standard residential mortgage.

Get in touch with our team for more help and advice on your barn conversion mortgage options. In addition, we can help connect you with a mortgage broker who understands your unique needs.

Should I use a barn conversion mortgage calculator?

Standard mortgage affordability calculators will only give you the core details of a mortgage, and this type may not be suitable for barn conversions. If a lender offers a barn conversion mortgage, there is a good chance they understand the unique situation, but this isn't always enough to guarantee success.

Every lender will have different criteria to meet before you are accepted for a barn conversion mortgage. This is why we recommend shopping around. Working with a whole-of-market mortgage broker will help you navigate the sector and find a lender who understands the situation.

A mortgage broker will also help you to understand your options, potential repayment terms and how to make the most of the opportunities available.

Working with a barn conversion mortgage specialist

Securing a barn conversion mortgage is more complex than a simple residential mortgage. This is why we recommend working with a specialist. Finding the best lender for your needs on your own is far more work, and we can help make this task easier.

If you need advice and support on making your dreams of converting a barn into a reality, we can help. Get in touch with our team today to discover how we can help guide your non-standard mortgage application.

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Niche Mortgage Info is a guidance website and introducer and is not regulated by the FCA. All of the advisers we partner with work only for firms who are authorised and regulated by the FCA and specialise in a number of different fields. They will offer any advice specific to you and your needs. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice.

By making an enquiry you accept that your information will be passed to one of the specialists.

Niche Mortgage Info is a guidance website and introducer and is not regulated by the FCA. All of the advisers we partner with work only for firms who are authorised and regulated by the FCA and specialise in a number of different fields. They will offer any advice specific to you and your needs. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice.

By making an enquiry you accept that your information will be passed to one of the specialists.