Browse Forums Home Finance 1 Jul 26, 2009 8:46 am I'm hoping someone on here can shed some light on the situation, if not i'll be calling the bank/morgage broker on Monday. I'm looking to build my first home on a new land release in Doreen. The block will be titled and settled in March 2010. To get as much of the FHOG, the building contract will need to be signed ASAP. (probably be in the next stage of the grant, so by the end of the year) How will a morgage work in this situation? Do I used my deposit to put down the 5% required by the developer to lock in the block? Will this still count as deposit towards the loan? Can you get a building contract to be signed on a piece of land that isn't going to be titled till March? Thanks for your help. Some people don't have time to do the job right the first time, but seem to have plenty of time to fix their mistakes. Build Thread Re: Loan for HOuse & Land with title on land not due till 2010 2Jul 26, 2009 1:56 pm I'm in a similar situation, where I am signing the building contract before land is titled for the FHOG. The title is expected around November 2009, and is in Mernda. The initial mortgage is land only, and will be somehow upgraded or merged or something into one loan later when money is paid to the builder. I paid the 5% to the developer myself and sent a copy of the receipt to the bank, on instructions from my mortgage broker (also advised by solicitor). And yes it counts towards the loan deposit, which is why the bank requires a copy of the receipt. And yes you can get a building contract on land that is not yet titled. I'm due to sign one in about 1 month from now. The original plan was to actually sign the contract before 30 June, and M was ok with this, even when we had not had colour appointment at that time. All things are flexible if you have a good reason. Good luck! PM me if you want details of my broker, she is in Ferntree Gully. Metricon Riva 33 - http://herlihy-riva.blogspot.com Site start 15/03/2010 - Handover 23/12/2010 9 months and 8 days (284 calendar days) from site start to handover Re: Loan for HOuse & Land with title on land not due till 2010 3Jul 27, 2009 11:28 am Thanks for the response btherl. Has cleared up a few things, but it looks like i'll need to have a chat with the bank with regards to my situation. Anyone else had a similar experiance, as more knowledge before I go the the bank is a good thing. Some people don't have time to do the job right the first time, but seem to have plenty of time to fix their mistakes. Build Thread Re: Loan for HOuse & Land with title on land not due till 2010 4Jul 27, 2009 1:50 pm Oh, one issue you may have is that construction must start within 6 months of signing the building contract. If the title is not expected until March 2010, that's cutting it fine. Most likely the title will be delayed further. Our original date was September 2009, now it's November 2009. What my expectation is is that as long as you EXPECT construction to begin within 6 months then you can most likely get an extension for the FHOG if it happens later. Our land vendor provided us with a letter stating that they expect the land to be ready by November 2009. Even if it gets delayed later, we can submit a copy of that letter and say "It's not our fault it got delayed". At least that's what I hope will happen! Metricon Riva 33 - http://herlihy-riva.blogspot.com Site start 15/03/2010 - Handover 23/12/2010 9 months and 8 days (284 calendar days) from site start to handover Re: Loan for HOuse & Land with title on land not due till 2010 5Aug 10, 2009 10:32 pm hi! I'm new to this blog and I find it helpful so far. hopefully someone can help me further with my specific situation. I'm similar to Richo where the land I have is to be titled in March 2010. Just a quick question, are there still a lot of paperwork or lead time before build can begin after the title is released? The reason I ask is because my builder is saying we can still catch on the $32K grant. To do this, I need to sign my building contract by Sept 30th and start building before end of March 2010. Is this feasible? Thanks in advance to your help! Re: Loan for HOuse & Land with title on land not due till 2010 6Aug 11, 2009 1:46 pm Hi Guys, I'm also new to the forum. I'm in a similar situation where my land will be titled in March 2010. I've emailed the SRO regarding the clause of building within 26weeks of signing the building contract, and below is the response I got. While there is provision for an extension to be granted in limited circumstances, you will have to demonstrate that you were of the belief when you signed your building contract that you would be able to commence building within the required time and that something occurred which was unforeseen and outside of your control that prevented you from meeting the deadline. If you sign your contract knowing that you will not meet the deadline you will not be eligible for the Boost. Now that last part where it states 'not eligible for the boost' means that instead of getting 32k, I will get 18k as part of FHOG. KungFuPanda Building with UrbanEdge He was so deadly, in fact, that his enemies would go blind from over-exposure to pure awesomeness! Re: Loan for HOuse & Land with title on land not due till 2010 7Aug 11, 2009 7:40 pm thanks ASCN. so are you still shooting for the $32K? did Urban Edge say if they can start building by end of March if it gets titled by early March? I'm wondering if people like us should shoot for $32K and risk ending up with $18K or just delay signing the contract to ensure that we get $25K. I'd only take the risk if the odds are good . Should we be "foreseeing" that land titles can get delayed? Re: Loan for HOuse & Land with title on land not due till 2010 8Aug 11, 2009 11:19 pm exactly right.... my choice right now is to do it or not to do it I'm going to seek professional advice before making the decision. for 7k less the risk is alot less.... but at the moment I'm weighing up my options let me know how you guys go.... would be great to hear some happy stories on here KungFuPanda Building with UrbanEdge He was so deadly, in fact, that his enemies would go blind from over-exposure to pure awesomeness! Re: Loan for HOuse & Land with title on land not due till 2010 9Aug 12, 2009 9:32 am I'm in a similar situation. Building contracts are all ready to sign. Land isnt avail until December. Originally the plan was to not sign the building contracts until the end of September so we had the maximum time allowed for the house to get to slab stage for the FHOG. Now I have seen that land gets delayed a lot (from my studys / web surfing) ... so consulting all the pro's on this... Basically what happens is you need some proof that everything you were doing shows that you were expecting to fit in with the FHOG guidelines, and that something out of your control has happened to delay the events. So in my case, I've got the expected land release date in writing. If that gets delayed which pushes the build date out... I should be all ok for the FHOG extension. Now fingers crossed nothing weird happens. But aparently this method happens a bit. I contacted the SRO as well to get advise on the FHOG Extensions (doing homework before any mishaps) and they said the same thing as the emial above. Its done on a case by case scenario. So get proof now that everything should fit in to schedule. In regards to the land being ready in March. Jeez I'm worried about a Decemeber date. My understanding is: The land titles are released. You then have soil tests and all sorts of engineer works done. It could be a few weeks before the site works even start. It's been a while since ive spoken to someone about this, but just remember you need to have the slab down, then you get the FHOG. PS: I'm not a pro on this. Just been sorting this stuff out for over a month now trying to comply with the FHOG. Re: Loan for HOuse & Land with title on land not due till 2010 10Aug 12, 2009 10:53 am whew, good to find people who can relate well to this dilemma (my builder doesn't!!! he just wants me to sign now! ). yeah, professional advice will be the best bet. I should look for one ASAP. in the meantime, I'm still working out the next steps after titling. So far, the only dependencies I see are land settlement, and building permit. my builder told me land can be settled before it is titled. I don't believe him and he's starting to lose credibility -- fast. can anyone comment on this? he also told me that building permit application can start before land is settled (still trying to verify this). soil tests can be done earlier than land settlement, but may need to be redone after settlement. Yup, it's not uncommon for land titles to get delayed builder usually charge around $1K for every month of delay that they are ready for a site start but the land is not. So worse case scenario is we get $18K FHOG, then penalty of $1K for each month the title is delayed. That will really be baaaaadddd... I'll take Marshy's tip and ask in writing the expected land date and also ask my builder to write that they can do a site start if the land is titled by first week of March. Hopefully these will be enough for an appeal. keep posting how you guys go! Re: Loan for HOuse & Land with title on land not due till 2010 11Aug 12, 2009 11:32 am If you signed the contract now. I cannot see how you would be at slab stage if the land release date is expected in March 2010. (going by my previous math on my land/house). Unless all that pre-settlement work can be done. But I have been basically told opposite with my Builder. So you will definately want a timeline written down by your builder, and a release date in writing if you are going to be applying for the FHOG extension. Just think of it, you want the best case you can put foward to show you were truly expecting everything to comply with the 26weeks / slab rules. Unfortunately my loans didnt go through without a house contract (fixed price) not signed. So im having to do a loan on the land, and then later on do the loan on the house (still need to talk to the morgage guy about that). But im definately not signing the building contract until late September. Re: Loan for HOuse & Land with title on land not due till 2010 12Aug 12, 2009 3:08 pm i was looking to sign the contract by end of Sept so that I need to start build by end of March (3-4 weeks after land titling). the plan is to get all pre-approvals beforehand. my bank just got back at me and they will need around 2 weeks from titling to settle the land. that leaves me 1-2 weeks from land settlement to get onsite. my wife (had to pretend to be a new customer) asked another sales consultant (SC) from the same builder about our situation, and she was more straightforward to us compared to our current SC. she said we won't make it to the $32K for the same reasons that Marshy79 mentioned. i guess I'll settle for the $25K. I'd be happy to be proven incorrect, if others have better info (or professional advise). thanks for all the help so far! Re: Loan for HOuse & Land with title on land not due till 2010 13Aug 13, 2009 1:21 pm An update in my case, even if i'm not as far advanced as a few others. Met with the bank, and they said their preference was to do one loan on the house and land. Deposit put on block, going back to the bank for a pre-aproval (hopefully unconditional) tomorrow morning. Balance of 5% deposit and land contracts in the afternoon. Then it will be the wait till next weekend to meet with the builders and start with them. Looking at the land contract, there is an area of proposed fill that stretches onto my block, so this will effect the soil sample, I hope it won't cause an issue with the building contract. I'm aiming for the $25k grant, with land title in March (if they are on time), and build start asap afterwards. Will try and update this as I go for future reference. Fingers crossed. Some people don't have time to do the job right the first time, but seem to have plenty of time to fix their mistakes. Build Thread Re: Loan for HOuse & Land with title on land not due till 2010 14Aug 13, 2009 5:00 pm Great stuff Richo, I think I will also gunn for the 25k FHOG. Seems a little to tight a timeframe to be getting the 32k. With regards to site costs, some builders give fixed site costs. Which comes in pretty good if you don't want to be stung by a hefty site costs bill. I've gone with UE and they fix the site cost at 2.5k which I thought was pretty good KungFuPanda Building with UrbanEdge He was so deadly, in fact, that his enemies would go blind from over-exposure to pure awesomeness! Re: Loan for HOuse & Land with title on land not due till 2010 15Aug 21, 2009 12:02 pm Pre Approved as of this morning!!! Now to see if I can keep the house to budget Some people don't have time to do the job right the first time, but seem to have plenty of time to fix their mistakes. Build Thread Re: Loan for HOuse & Land with title on land not due till 2010 16Aug 21, 2009 12:26 pm btherl Oh, one issue you may have is that construction must start within 6 months of signing the building contract. If the title is not expected until March 2010, that's cutting it fine. Most likely the title will be delayed further. Our original date was September 2009, now it's November 2009. What my expectation is is that as long as you EXPECT construction to begin within 6 months then you can most likely get an extension for the FHOG if it happens later. Our land vendor provided us with a letter stating that they expect the land to be ready by November 2009. Even if it gets delayed later, we can submit a copy of that letter and say "It's not our fault it got delayed". At least that's what I hope will happen! Also don't forget to allow for the time it takes for permits... Re: Loan for HOuse & Land with title on land not due till 2010 17Jan 13, 2010 11:10 am Been a while, but I thought that I should update my story on here, as it may be helpful for others. House was kept close to budget, but provisional site cost pushed it up a little. Went back to the bank and got my pre-approval extended. This was late October. Signed my building contract in mid December and got a copy of the signed contract to the bank before the christmas break. Followed up in January, and was told there may be a problem, as interest rates have increased a number of times, and my maximum borrowing capacity would now be a lot lower! Almost $20k lower. My consultant said that she would try and get the loan approved on the pre-approved amount, but couldn't promise anything. Got nervous when I kept getting told that I would have an answer that day, and didn't. This happened for a few days running. Got a call yesterday afternoon that the approval has gone through, and is now with valuation. Should know by this time next week if everything is ready to sign. Judging by the rate that things are getting done in the development, it should title on time or early. Cheers Richo Some people don't have time to do the job right the first time, but seem to have plenty of time to fix their mistakes. Build Thread 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 19097 Flamingo Give me a call and I will do my best to talk you through it. For those who would like an answer, Subject to seeing your actual DA condition, I think you are… 1 4572 As per title, unsure if my land doesn’t have enough fill. The house on the left seems to have higher elevation. Not sure if the empty lot in between has just been… 0 543 |