Building your house is a rewarding experience. However, it is also a challenging and multifaceted undertaking that involves different parties and often requires colossal sums of cash to complete.
One way to finance such a project is through a New Build Home Loans. A quick check on the internet will inform you that you’ll need to furnish the bank with documents such as your recent payslips, information on other financial obligations, current tax returns, and an indication of the deposit size.
That’s the easy part. What about what the bankers and mortgage brokers won’t say?
Here’s what everybody should know about new build home loans but the bank will not tell you.
Whereas bankers, mortgage brokers, builders, and tradesmen have their interests, your expectations should take center stage. As you apply for the new build home loan, make it clear to the bank staff or mortgage broker that you expect honest and timely responses. This will help you work out a good estimate of the timelines such as when to expect an approval and draw down so that you can commence the project.
Patience is crucial when applying for a new build home loan. However, keep in mind that if the drawdown happens off the project’s timelines, you could end up at a loss. Contractors could charge additional fees or and banks will not suspend interest.
Contact our new home build loan experts who will help you to foresee such risks and, take steps to prevent them.
Before you apply for the new build home loan, you should ensure that you have a valid building contract with a contractor who is licensed and insured as well as the government approved plans. The lender will request for documentation to ascertain these areas are well covered. Make sure that your construction project and subsequent loan application is commensurate with the property value. Banks will perform a loan to value evaluation of the property and check out the pricing of other properties in the area before recommending for approval.
Approval for a new home build loan is often entangling and can instigate a lot of back and forth or delays. Our experts can help you avoid this and ensure all documentation is valid and in place.
Have you sought a second opinion on the construction contract?
If you are yet to, our experts can help you run through your building contract and highlight areas to reconsider before applying for the new build home loan. Amendments to the construction contract are costly. Not only do they attract fines, but they also compel the lender to re-assess the entire loan application.
Our advisory team can help you come up with solutions to address changes in the contract that have less adverse effects.
Make sure that you keep saving amidst the building process and avoid incurring substantial expenses. It is also advisable to seek for approval of a new home build loan that’s slightly higher than the budgeted amount. This ensures that you are sufficiently liquid and won’t have to divert to other, more expensive, forms of borrowing to bridge any gaps that may arise.
To wind up, make sure that you get in touch with our consultants. We will help you secure a new build home loan and give you loads of other information that your banker will not inform you.