Hi there wonderful person!
We have just secured a block in qld with the initial deposit. Registration of the land is not until May 2022. We have already chosen the builder and the design is cleared for the block with a quote provided and the builder asking for a 3k deposit. Builder has mentioned that build time is approx 6months.
My questions are:
1. At what point would we need to pay the next large sum and start the house/land loan (already have preapproval)
2. During the registration/building phase assuming the loan has started do we have to pay full repayments I.e interest +balance as during this period we will also have to pay rent.
Thanks for your time…
T.B.R
Loan repayments during registration/building phase
Page 1 of 1
Forgot to add:
3. Are there any tax confessions to consider during this period
3. Are there any tax confessions to consider during this period
Hello, enjoy the process!
To point 1 - if you’ve already exchanged on the block then nothing more to pay there until settlement (after registration). The next payment to the builder is typically 5% of the contract & normally not until the bank approves and you have the contract, plans, specs etc - but I’m seeing builders asking for a bit more for drafting etc at the moment. Either way, next big payment there is the deposit stage.
In terms of repayments - it depends on how your loan is setup, and you can check this and change it between now and then - most banks want interest only repayments on the balance owed as you progressively draw down the loan. This will suit you too while you’re renting.
So, that’s interest only on the land
Then interest only on the land and build deposit
And interest only on the land, build deposit and slab
Interest only on the land, build deposit, slab & frame…
Etc. reverting to principle and interest repayments at completion.
To point 1 - if you’ve already exchanged on the block then nothing more to pay there until settlement (after registration). The next payment to the builder is typically 5% of the contract & normally not until the bank approves and you have the contract, plans, specs etc - but I’m seeing builders asking for a bit more for drafting etc at the moment. Either way, next big payment there is the deposit stage.
In terms of repayments - it depends on how your loan is setup, and you can check this and change it between now and then - most banks want interest only repayments on the balance owed as you progressively draw down the loan. This will suit you too while you’re renting.
So, that’s interest only on the land
Then interest only on the land and build deposit
And interest only on the land, build deposit and slab
Interest only on the land, build deposit, slab & frame…
Etc. reverting to principle and interest repayments at completion.
Forgot to add:
3. Are there any tax confessions to consider during this period
3. Are there any tax confessions to consider during this period
Is it your own home or investment? If it’s your own home the considerations are around the stamp duty concession and any first home grant available.
Investment - you used to be able to claim the interest during constructing but I don’t believe you can anymore - it’s now added to the base cost for CGT.
First home buyer
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