Bungalow Mortgages Explained

Bungalows are a popular property type in the UK, particularly among the elderly, those with restricted mobility and anyone seeking an environmentally friendly home. But what are your options if you need to take out a mortgage to buy one?

In our guide to bungalow mortgages, you will learn whether it’s more difficult to get a mortgage on these properties, how to go about it, and how we can help.

Can you get a mortgage on a bungalow?

Yes. Some bungalows are no more difficult to get a mortgage on than standard houses, but keep in mind that there are lenders who place restrictions on specific types of bungalow. Some of these properties fall into the ‘non-standard construction’ category, which makes it more difficult to get approved for a mortgage due to the higher level of risk.

Types of bungalow that can be more complex to get a mortgage on include:

• New build bungalows
• Dorran bungalows
• Woolaway bungalows
• Colt bungalows
• Ex-local authority bungalows

Read on to find out what obstacles you might face when applying for a mortgage for these types of bungalows and how to overcome them.

New build bungalows

New build bungalows aren’t much more difficult to get a mortgage on compared to older ones, but some lenders have higher deposit requirements for newly constructed ones. 

You might find loan-to-value (LTV) requirements of 75-85%, meaning you would need at least 15% deposit to get approved, but there are lenders who will accept 5-10%.

Dorran bungalows

Dorran bungalows are made from precast reinforced concrete (PRC), which places them in the category of non-standard construction. Certain mortgage providers won’t lend on them at all, as some of these properties suffer from issues like damp and poor insulation.

Some lenders won’t even consider a mortgage on a Dorran bungalow if it was built before 1985, others if it was constructed before 1945, and the LTV can be capped at 40-80%.

Quite often, repair work will need to be carried out on a Dorran bungalow to bring it into a mortgageable state. This typically involves replacing or reinforcing the original structure using standard building materials, such as brick and stonework.

With the necessary work carried out, you can obtain a PRC Certificate of Structural Completion from a structural engineer to prove to lenders that the property is safe.

Woolaway bungalows

Woolaway bungalows are another type of property with elements of non-standard construction. They often have a concrete frame or concrete walls, although these properties are more likely to have had repair work completed, and more recent ones have brick walls.

Like with Dorran bungalows, your key to accessing more mortgage lenders and boosting your chances of approval is obtaining a PRC Certificate of Structural Completion. This might mean having repair work carried out, though it may not be necessary for newer bungalows.

Colt Bungalows

These flatpack homes usually have a timber frame with outer walls that feature brick cladding, but in some cases, they are made entirely from timber. 

Colt bungalows are not as problematic for mortgage lenders as Wollaway or Dorran, but extra scrutiny will still be placed on the valuation report and surveys.

You might, however, need a specialist lender if any of the below applies:

• The property is made entirety from timber
• It was built before 1970
• There is cavity wall insulation between the frame and the cladding

Ex-local authority bungalows

The issue with ex-local authority bunglows is often their construction type as non-standard materials such as steel frames, concrete, and pre-cast reinforced concrete is often present.

It is possible to get approved for an ex-local authority bungalow up to 95% LTV, but some lenders insist on a higher deposit than this, and they will place extra scrutiny on the valuation report and surveys to ensure that the construction type won’t pose any issues.

It is possible to use the Right to Buy scheme to buy an ex-council bungalow, though they are in short supply compared to traditional council houses.

Other criteria you will need to meet

A big part of the eligibility criteria for a bungalow mortgage relates to the property itself, as your lender will need to be confident that the materials the bungalow is built from won’t pose issues. It’s possible you might need a lender who specialises in non-standard construction.

Outside of the property-specific factors we have already discussed, your chances of getting a mortgage on a bungalow will improve if the following requirements are met:

• You have clean credit
• The mortgage term won’t run past your 75th birthday
• You have at least 5-10% deposit
• You have adequate proof of income*

*Three months’ wage slips if you are employed or 2-3 years’ accounts if self-employed

If you’re concerned that issues with your property might derail your mortgage plans, get in touch. Our brokers are experts when it comes to non-standard properties, including bungalows, and they have deep working relationships with the lenders you need.

How to get a mortgage on a bungalow

The ideal first step is to speak to a mortgage broker who specialises in complex properties to help you navigate the extra steps bungalow mortgages sometimes involve.

We have mortgage brokers on our team who are experts in these properties, and they can help guide you through the following steps to full application:

• Reviewing the valuation report to uncover any issues with the property
• Commissioning repair work (if any is needed)
• Obtaining a PRC Certificate of Structural Completion (if required)
• Securing the best mortgage deal available to you

If you’re ready to take advantage of a free, no-obligation chat with a broker who specialises in bungalow mortgages to find out what your options are, get started below:

Get tailored advice on bungalow mortgages

Speak To An Adviser

Which mortgage lenders are available?

Below you will find examples of the lenders available for bungalow mortgages along with examples of the specific criteria they apply for this property type.

• Barclays: Will lend on bungalows, including ex-local authority ones, subject to the valuer’s comments, and as long as marketability is not impacted.
• Halifax: Lends on bungalows up to 95% LTV.
• HSBC: Will cap the LTV at 90% for this property type and requires a structural defects warranty to be in place for all bungalow mortgages.
• Accord Mortgages: Cap their maximum lending at 95% LTV for bungalows worth up to £600k, but has a lower LTV of 75-90% on properties worth £750k to £5 million.
• Coventry Building Society: Will lend up to 95% LTV on older bungalows but new build properties will have a lower LTV cap than this.

If your bungalow is confirmed to feature non-standard construction, you might need a specialist lender - get in touch for bespoke advice about them.

How much can you borrow?

You can usually borrow up to 95% of the property’s value on a bungalow, but the LTV cap might be lower if it’s a new build or has non-standard construction features.

Lenders will also apply a multiple of 4.5 to your annual salary to work out your maximum borrowing, although some lenders use multiples of 5 or higher for affordability.

You can use our calculator below to work out how much you can potentially borrow:

Why choose Teito for your mortgage needs?

At Teito, you can access expert advice from mortgage brokers who specialise in complex property types, including bungalows. This can help you boost your chances of mortgage approval and securing the best rate, as well as saving time in the long run.

Here are just some of the reasons people choose us for their mortgage needs:

• Our brokers specialise in bungalow mortgages
• They can access exclusive rates and deals
• We are 5-star rated on leading review websites
• You can secure an agreement in principle in minutes

Ready to take advantage of a free, no-obligation chat with one of our brokers to find out how much they could help you save on your mortgage? Get started here.