Browse Forums Building A New House 1 Nov 13, 2016 7:07 am Hi all we bit the bullet and put a deposit on a block of land which won't settle until mid 2018 – we have been told it's too far away to get preapproval for finance – we have been looking at display homes and fell in love with fairhaven homes – we have paid $750 deposit to lock in current prices as they are going up every couple of months as well as locking in the current promo- we now have been told we need preapproval for mortgage before they'll sign off On my way! Quote we said this was difficult as so far off- we were then told a letter from a broker saying we could service the land loan was enough- does this seem right? My partner is currently studying and I'm on 85K a year our land is $370k and we have paid $37k deposit do you think I'll be ok getting a letter to say I can service land loan? If not we are in trouble – we plan to keep saving and my partner will be working full time in 12 months time when we actually apply for loan. Re: Loan preapproval 2Nov 13, 2016 8:02 am Nae84 Hi all we bit the bullet and put a deposit on a block of land which won't settle until mid 2018 – we have been told it's too far away to get preapproval for finance – we have been looking at display homes and fell in love with fairhaven homes – we have paid $750 deposit to lock in current prices as they are going up every couple of months as well as locking in the current promo- we now have been told we need preapproval for mortgage before they'll sign off On my way! Quote we said this was difficult as so far off- we were then told a letter from a broker saying we could service the land loan was enough- does this seem right? My partner is currently studying and I'm on 85K a year our land is $370k and we have paid $37k deposit do you think I'll be ok getting a letter to say I can service land loan? If not we are in trouble – we plan to keep saving and my partner will be working full time in 12 months time when we actually apply for loan. Hey Mate, I think this is too early if your registration is in 2018. Nobody will keep current prices for 2 years unless u pay price hold fee which to me there is no point. You never know what would happen to developer. Best time for you fis 6 month before settlement. All inclusions and promo will change 10 times before that date. It happened to me and I lost 3k deposit. I hope it helps. Re: Loan preapproval 3Nov 13, 2016 11:31 am It is a long time, especially as there is no guarantee it won't take longer for your land to settle. You might be better off just waiting to pick a builder until closer to your build date. I paid land deposit in July 2014 which an expected settlement date of April 2015. I was working with a few builder's, but had to put it on hold.. eventually picked my builder in October 2014. My land settled February 2016 . My builder did hold my price, though I didn't sign my contract to Feb 2015... my build is currently progressing. If I had of gone with a volume builder in July 2014 (one of my choices), I would have locked in a price that was about ... 10k cheaper than if I have signed up with them in 2016, however because my land settlement was 10 months late.. they had some sort of clause which said that for every month settlement was delayed I had to pay them 2k, so I would have been in big trouble!!! Also, some other things to consider, I picked my design and colours in 2014... during my very long wait I learned so much more about houses, and would have made a lot of changes, but I was locked in. You just never know, prices might go up or they might go down... promotions change, styles change.. Might be best to wait and save some more for now. All the best. Re: Loan preapproval 4Nov 13, 2016 1:51 pm We had recieved pre-approval before we started looking at land. We then had to read apply every 3 months after that. I do think it's far to early. Re: Loan preapproval 5Nov 18, 2016 6:11 pm Also make sure there is no sunset clause that expires before the estimated settlement date in the land sales contract, there have been instances where a developer has gotten sales contracts signed and then been able to delay settlement for long enough so the land value is better then originally sold for The sunset clause is then activated to refund the buyers deposit (in line with the sunset clause) only to re-release the land for the current higher value price. Essentially the developer uses the land sales contracts and deposits in trust to leverage a loan for their works only to then cancel the original contracts and release for better money. The buyer is left with their deposit and no way to conceivably buy at the new price unless they raise more funds and hope they qualify for a loan at the higher price. The biggest challenge will be if you take out a loan and then run out of money - you'll have an incomplete security and lenders do not like this so you can get stuck.… 2 19096 Hi, you've probably already resolved this, however, Commbank will probably pay the funds to you after you send evidence the work is done regardless the change in the quotes. 1 35321 How much are you ahead in payments compared to where the build is at? Have you fully drawn down the loan? 5 11916 |