Finding the right mortgage is complex if you are building your own home and many banks make it tough to obtain a construction mortgage.
However, the right loan can save you a lot of money which you could spend on better quality fixtures or furnishings for your new home.
The ideal construction mortgage should allow you to draw down the money you need for each progress payment to the builder.
That way, you are only paying interest on the amount you need at each stage of the construction process.
However, the right loan can save you a lot of money which you could spend on better quality fixtures or furnishings for your new home.
The ideal construction mortgage should allow you to draw down the money you need for each progress payment to the builder.
That way, you are only paying interest on the amount you need at each stage of the construction process.
Here are our top 5 tips to find your ideal construction loan
Prepare your budget
Before you sign any contracts, make sure you know how much money you have available to build your new home. This includes the money you have now and the amount you can borrow.
Have a fixed price contract
This gives you certainty on how much your new home will cost to build and sets limits for your builder. This is also the time to check the progress payment schedule to ensure it reflects the actual work completed at each stage.
After you have paid the initial deposit, you should never pay for work in advance.
Obtain legal advice on the contract before you sign
It is usual to seek help from a conveyancer or solicitor when you purchase the land. However many people overlook the need to obtain legal advice before they sign the contract.
Once you sign the building contract, you are legally bound to adhere to its requirements so make sure you understand your obligations and those of the builder.
Check the allowance for key fixtures
With a fixed price contract, the builder allows a certain amount for all of the fixtures. These allowances are often based on basic models or the average cost of items in that category.
If you want a prestige finish or have a high-end fixture in mind, it will increase the price of building your new home. So check the specifications carefully.
Contact Us
If you would like further information on Construction Loans, please call 1300 942 856 or request a call from a Mortgage Consultant here
Before you sign any contracts, make sure you know how much money you have available to build your new home. This includes the money you have now and the amount you can borrow.
Have a fixed price contract
This gives you certainty on how much your new home will cost to build and sets limits for your builder. This is also the time to check the progress payment schedule to ensure it reflects the actual work completed at each stage.
After you have paid the initial deposit, you should never pay for work in advance.
Obtain legal advice on the contract before you sign
It is usual to seek help from a conveyancer or solicitor when you purchase the land. However many people overlook the need to obtain legal advice before they sign the contract.
Once you sign the building contract, you are legally bound to adhere to its requirements so make sure you understand your obligations and those of the builder.
Check the allowance for key fixtures
With a fixed price contract, the builder allows a certain amount for all of the fixtures. These allowances are often based on basic models or the average cost of items in that category.
If you want a prestige finish or have a high-end fixture in mind, it will increase the price of building your new home. So check the specifications carefully.
Contact Us
If you would like further information on Construction Loans, please call 1300 942 856 or request a call from a Mortgage Consultant here
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