Mortgage lenders set limits for properties with land
Page updated 21/11/2023.
Trinity Financial has access to various small and larger lenders offering property with land mortgages. Some will cap the maximum acreage, while others have no limits.
Many banks and building societies set acreage limits to ensure they lend on smaller, more traditional homes rather than country houses, rural estates and farms.
Aaron Strutt, product director at Trinity Financial, says: "High street lenders offer mortgages to buyers purchasing country homes with land. You need to know the best ones to approach.
"These banks and building societies rely heavily on their property valuer's comments, and they decide whether the house is in a good location and a suitable condition."
Mortgages for properties with separate cottages, stables or outbuildings
Suppose a property has separate cottages on the land, large stable blocks, outbuildings, or animal grazing rights. Some lenders will refuse the application, refer you to speak to a different department or tell you to take a commercial mortgage if you apply directly.
Trinity Financial's brokers know which lenders are keen to provide mortgages when properties have land or more unusual uses.
Lenders offering mortgages with land without acreage restrictions
Nationwide for Intermediaries will consider applications from clients looking for larger homes with land, although the property must be used entirely for the applicant's residential purposes. The society will not lend if the house or land is used for business or commercial agriculture.
One of the biggest banks offering £250,000+ mortgages has no acreage limit providing you have a 25% deposit. If you have a smaller deposit, it is reduced to 15 acres. The lender will also require a full structural survey of the property.
Other high-street lenders have similar policies to Nationwide. For example, Skipton Building Society says it does not have a maximum acreage, providing the property is used for residential purposes with no income derived from the land.
How can Trinity Financial's brokers help arrange a property with land mortgage?
Trinity Financial's brokers have access to other lenders that technically do not have a maximum acreage. We work with their specialist application managers to agree on larger loans for properties with land. We recently arranged a historic country house mortgage for a property with 40 acres. It also had a paddock, a large pond and a swimming pool.
Private banks offer mortgages to wealthier clients buying larger houses with land, and they can be flexible if the property has outbuildings or hosts weddings. We have recently secured access to a private bank targeting wealthier borrowers buying houses with land, although the rates are not as cheap as they used to be.
Mortgage lenders with restrictions on the amount of land
Accord Mortgages, part of the Yorkshire Building Society, says its limit is usually two acres. The lender says properties with a large acreage attached must be valued using the house and immediate garden only.
Virgin Money for Intermediaries has a maximum of five acres, while NatWest prefers not to exceed ten acres. Santander states that properties with agricultural land/large acreage must have no more than ten acres of land, although exceptions can be made.
Are you purchasing a property with income generated from outbuildings or land?
Some small building societies provide mortgages on properties with land, even if it generates income from outbuildings, stables, kennels, or animal grazing.
The lender is flexible, providing the property in a good location in England and Wales. The rates and arrangement fees will be more expensive than the bigger and more mainstream lenders, but they are unlikely to accept many of these applications.
Mortgage rates from properties with lots of land
Many more lenders are offering sub-5% rates. Rates are more competitively priced for residential mortgages rather than commercial mortgages.
Call Trinity Financial on 020 7016 0790 to secure a mortgage for a larger property with land, or send an enquiry with a link to the property you are buying
Yes, but the more acres of land a property has, the fewer lenders you’ll have to choose from.
Most banks and building societies will consider properties with up to two or three acres.
Many will consider properties with up to 10 acres on a case-by-case basis.
Trinity Financial has access to a selection of high street and private banks considering properties with over 10 acres.
For over 14 years, we have helped our clients secure finance for their farms, country estates and rural development projects.
Trinity Financial has a trusted list of contacts at high street lenders and private banks, providing wealthier clients with options to fund those unique properties.
Banks and building societies offering a property with land mortgages do not tend to mind if the application is for a purchase or remortgage.
If you currently have a residential mortgage and you do not use any of your land for commercial purposes, you should be able to remortgage with a new lender.
It is surprising how many of the biggest banks will agree to property with land mortgages. They also have the cheapest mortgage rates with the lowest arrangement fees.
Providing the property does not have a commercial element or let outbuilding they are happy to issue mortgages - providing you speak to the right person at the bank or building society.
- Bluestone: Yes however properties with over 40 acres are not acceptable.
- Earl Shilton Building Society: No maximum on acreage.
- Hinckley & Rugby Building Society: The Society may consider lending on a property with acreage, providing their are no agricultural restrictions.
- Kensington: For properties in excess of 3 acres the valuation should be based on the residential property and immediate gardens; the latter must not exceed 3 acres.
It is worth noting if one of these lenders will provide a mortgage on a property with land, one of the bigger providers offering cheaper rates will probably offer a mortgage too.
Some lenders will consider properties individually with a mixed-use with a minimum property value of £250,000 at a maximum loan-to-value of 75%.
One lender issuing terms says the main property on the title must be occupied by the borrower on a residential basis and with a minimum of 60% of the property to be used for residential purposes.
The lender defines 60% residential criteria as the
available floor space/land directly connected to the
residential property.
The lender will consider providing mixed-used mortgages for:
• DIY Liveries;
• Properties with land used for third-party grazing,
subject to an annual grazing licence;
• Small-scale agricultural/horticultural enterprise subject
to this not being the applicants only/primary income
source;
• Properties with a garage or outbuilding converted as
a consulting room, grooming parlour or similar;
• Buildings on-site may be used for Holiday Let or Buy to let purposes and must conform to relevant
planning and local authority approval (if applicable).
Private banks do not tend to have an issue providing mortgages to wealthier clients buying properties with land. They also have more flexibility if the property is a country house, for example, they are more open to it being used to host weddings and private functions.
Types of use we often see alongside using the property as a main residence include:
- Holiday lets
- Hosting weddings
- Air BNB
- Renting outbuildings to commercial tenants
- Livery
- Equestrian centres
- Renting land to local farmers
- Cattery
- Kennels
- Festivals
- Rental property on the land
Get started today
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