Browse Forums Owner Builder Forum 1 Oct 18, 2011 12:53 pm Hi, I went and saw my bank manger (one of the 4 major banks) and they didnt seem to interested in dealing with me as an owner builder as i was told it is very difficult to get approval and she has only had a couple go through in the last few years.Can any recommend a bank or company in Melbourne that i could go and see for finance to owner build? I am thinking of getting a builder to lock up stage and then finishing the project off myself. Re: owner/builder finance 2Oct 18, 2011 12:58 pm there are many tread on this topic. Owner builders loans are in the to hard basket for many loans managers, and they are usually inexperienced with the whole process. If you have equity you shouldn't have a big issues. Say if you have land worth 400K and you owe 50K to the bank. You have 350K in equity. borrowing 80% of this should be relatively easy provided you see the right person. Make sure you dont refer to it as an owner builder loan. You just want to realease the equity in you land to by an investment property if you see one, on short settlement terms to negotiate a better price. Re: owner/builder finance 5Oct 19, 2011 12:58 am B STAR there are many tread on this topic. Owner builders loans are in the to hard basket for many loans managers, and they are usually inexperienced with the whole process. If you have equity you shouldn't have a big issues. Say if you have land worth 400K and you owe 50K to the bank. You have 350K in equity. borrowing 80% of this should be relatively easy provided you see the right person. Make sure you dont refer to it as an owner builder loan. You just want to realease the equity in you land to by an investment property if you see one, on short settlement terms to negotiate a better price. I am with B Star, we are doing the 80% through 2 properties... and with a Major.... i have one hoop to jump through and they are requesting a builders license.. A Bit pointless if you are doing an "OB"! It looks like we have a work around i will be on the phone tomorrow and i have an appointment lined up for the end of the week... I wil keep u posted... There are many rules on OB's from the bank because of our generations before us getting into trouble... Banks like paper work, get lots.... Let them know your in control & your on top of everything, the coins will hopefully land on your side of the fence All the Best! Re: owner/builder finance 7Jan 02, 2012 10:43 pm Steve Avoid debt as much as possible and only build as you can afford it would be my advice. The 'want it now' mentality will cost you a lot of money in the long run. good point Steve.. we ar ewith a small-ish building society in Qld and they have put it in the too ahr dbasket as well, suggesting instead that we delay the big build and pay as we go December 2011: plans drawn. June/July 2012: Phase 1 begins: raising and restumping. Concrete slab to replace current slab . Build back deck including roof. Build downstairs external wall. Re: owner/builder finance 8Jan 03, 2012 8:51 am While I agree with Steve that the 'want it now' attitude can end up costing you in the end. I have to disagree to a certain extent about not going into debt. Getting finance to buy or build a home is about making an educated, well managed plan! I do not agree with these crazy 95%+ home loans but if you have reasonable debt then there are benefits from going into managable debt. If you put yourself in a position where you have no 'emergency' money saved or no job security or you are eating baked beans every night for tea then you probably have too high a debt to handle!!! We would not be in the financial position we are in today without going into debt. We had saved a very good deposit and had a mortgage for our 1st build (1st home)! We sold it 18months later for $210K more than what it cost us - ok so we were lucky selling when the property market in our area was red hot but we also made a considered and informed decision weighing up risk and reward (there is always risk in going into debt) and we had a loan that we easily managed with 2 good incomes, no kids and well paid secure jobs. Had we waited a few years to save so we didn't have debt, land prices had all gone up as did building costs. Even on well paid jobs it takes a very long time to save that kind of money!!! I'm sure most people can think of wealthy people who started off with not a lot of money but had a business or housing loan!!!! Back to the original post - did you manage to secure a loan?? I agree with B star the best way to get owner/builder finance is with equity/assets you already have. Shopping around for a loan would be my best suggestion. Owner/building - it will make you cry, laugh, get frustrated and also make you very proud of yourself!!! Good luck. Re: owner/builder finance 9Mar 05, 2013 10:59 am You're right about Owner Builder Loans being in the hard basket. Although there seems to be a few products on offer with the Big 4 they are very limited in terms of LVR and not to mention in how strict the conditions are. But if you dig deep enough you'll find specialist Owner Builder Finance products with up 80%LVR of the completed project. When you translate that it works out about 90% of the construction cost depending on how much you're saving by doing it yourself. Re: owner/builder finance 10Mar 05, 2013 2:12 pm My finance is through NAB -- 60% of the finished value only, and there were a heap of hoops to jump through. Plus a higher interest rate, which I hope to rectify once the build is complete and I transfer to another lender. You're right: they're not kind to OBs at all, largely due to the risks involved. Borrowing more than 60% of the final value is probably not a prudent thing, as costs will certainly blow out on you. I was absolutely meticulous with my costings, and I'd purchased a lot of materials, etc before entering into the loan. But even then, I'm now about 10% over my estimates. A 20% blowout on most OB projects is not unheard of. Try to get a fair chunk of savings behind you as a backup. And if you end up not using it, go to Paris on a holiday! My storybook home build: https://forum.homeone.com.au/viewtopic.php?f=38&t=57987 you were just referred to get advice from your solicitor. This is a legal matter. Separately, why would you use a buyers agent for a house and land package? 3 54978 Hi VK, I am now retired however I have stood beside over 300 owner builders in the past 18 years that have successfully built their own homes. First of all a building… 10 22562 |