Browse Forums Home Finance 1 Nov 11, 2009 10:52 pm Hi everyone, Im going to apply for owner builder loan soon via westpac as I have bought a vacant lot and the loan is with them already. Certification for my house plans are almost complete and will be ready to build soon. Would anyone who have been through this, explain the requirements that the bank would be asking for? and how it all works? I have been told that I need to submit a cost estimate from an independent supervisor and also provide progress payment reports certified by an independent supervisor. Who is considered a qualified independent supervisor? and is the cost estimate necessary or will they do a valuation based on the plans?? Also, how and when will the bank allow the approved loan amount to be used? Obviously it cant be when I run out of money? as I need to keep paying the contractors and will not be able to pay in stages! Very much appreciated if anyone can provide more insight to the above! Thanks in advance. PS. my LVR is 60%. and I in Brisbane. Re: Owner Builder Loan 2Nov 12, 2009 7:23 pm This is the criteria St G***ge provided me with. Prior to any funds being advanced -------------------------------------------------------------------------------- A current Owner Builder's licence/permit to be provided to the Bank; Builder's All Risk Insurance (Contractor's Risk Insurance including Public Liability). The insurance should cover the minimum replacement cost. It must remain current during construction, and St.George must be noted as the mortgagee. Receipt/sighting of Council approved plans & specifications must be confirmed by the Bank's (original) valuer Any shortfall of funds i.e. difference between borrowers funds + loan amount being less than Owner builder cost estimate worksheet, must be followed up by the lender. The lender will need to ensure that the borrower has enough funds to complete and confirmation email sent to the Progress Payments Team. A satisfactory valuation report detailing value of construction on an "as is" basis & remaining funds to complete. A satisfactory Survey Report showing the location of the completed footings / slab identifying the land and showing where the foundations / slab are locate din relation to the boundaries Owner builder cash flow / cost estimate worksheet to be held by the Progress Payments Team. BUT good luck. I have been trying to get finance approval since July. ( I had 50% equitity, which came down to 40% equitity with their ridiculous valuations)I just seem to go around and around in circles, I provide one lot of info they request only to find out they require something else, also they set our loan debt ratio at 1.3% which I beleive is a lot higher than normal. I wish you all the best and hope you have more success than me Re: Owner Builder Loan 3Nov 13, 2009 11:42 am Hi mayjay, Thanks very much for that information, I have obtained some information from westpac and it seems somewhat similar requirements. (its probably because st george is now a subsidiary of westpac...) Just wondering, what kind of person/profession or who did you use that can do and sign off the cost estimate report for the progress payment reports? I really hope you get some good news soon from the bank. Cheers Nelson Re: Owner Builder Loan 4Nov 13, 2009 7:32 pm We used an estimation service that was recommended by another Owner Builder. I`m not sure who to use in Brisbane, maybe going over to the Owner Builder Section of this forum and ask for a recommendation in Brisbane. All The best Re: Owner Builder Loan 5Nov 13, 2009 10:38 pm we went through similar issues. They will pay when stages are completed, which is great for a project home, but this isnt as useful forthe OB. If you have existing properties look at re-morgaging them to get a cash fund together. You can use this to pay trades in cash and negotiate a discount, then top the cash fund up when the bank recognise you have completed a stage. In the end the bank see OB's as a high risk and are reluctant to play ball since the GFC. We had trouble getting funds to complete our house even though the equity after a valuation was really high. In the end it was not worth the hassle of westpacs conditions to get a 100k loan to finish off the project, so we told them we wanted the money to invest in shares and it was processed and aproved in 2 weeks. Re: Owner Builder Loan 6Nov 14, 2009 1:25 am Thanks mayjay. I might try that. Hills Guy, wow that doesnt sound promising :S Unfortunately i dont have any other property to finance from. Will have to dig abit deeper and see what the relationship manager can do for me... 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 13528 Hi folks, Victoria resident here. I've submitted my owner builder application to the VBA. I thought I'd share my experience so far. I submitted my application… 0 6185 |