Browse Forums Home Finance 1 Feb 24, 2008 10:56 am Hi guys... (me again )
Just a quick question, if you decide to do certain things outside of the building after handover eg. carpets, floorings, window furnishings....can these be included in your home loan so you don't have to dig up the cash from somewhere?? If yes, is there a special type of loan you need to apply for or anything else you have to discuss with the bank etc? Is there a limit to the amount they will lend you for these 'extras' (subject to your financial situation obviously) Thanks heaps Belinda Re: Home loan question 3Feb 24, 2008 5:39 pm If you have enough deposit to avoid mortgage insurance (that is, 20% or more deposit) then borrow more than you need. Pay it down quickly and you can redraw this amount for whatever you like. Demolition August 2009, Construction Started September 2009, Completed December 2010 Paying tradies from mortgage 4Feb 25, 2008 2:48 pm I think different lenders may handle this situation differently but were told we had to be pay a substantial admin fee to the bank per cheque written out to different external companies. Just let them know that you will be paying other suppliers aside from your builder when you apply for your mortgage and they'll tell you how it is done and their costs. C&G -------------------------------- A new building chapter begins.. Re: Home loan question 5Feb 25, 2008 4:58 pm When I applied for my construction loan (pre-approval stage) I simply 'overestimated' my builders cost by several thousands.
By overestimating the construction costs, I simply told my bank that I'd made an allowance for landscaping, air con, sheds etc from other contractors. After the final drawdown is paid to the builder, the remaining funds that are left over can simply be paid directly into your account. (Their paperwork simply asks that you put down where the funds will be spent, e.g. landscaping) This allows the funds to be placed directly into your savings account, allowing you to pay any sub-contractors whichever way you like.... Because I added quite a buffer to my costs, I also have the option of not accepting the money & having a smaller loan to pay off....Which I think is a good option the way interest rates are at the moment. Re: Home loan question 6Feb 26, 2008 9:05 am When I put in my loan application I submitted quotes for extras (flooring, security, air conditioning etc) and when they disbursed the loan they transferred the extra funds to me so I can pay for these extras myself.
I don't think all places will do that (I was surprised they just handed over the extra money to me) I think other places want to pay the companies themself. Re: Home loan question 7Feb 26, 2008 9:13 am We had about 13k left over after construction finished which they asked us what we wanted done with it. We could have either closed the loan off or had the excess paid into our savings account. Built Porter Davis "Dromana" 2007. Re: Home loan question 8Feb 27, 2008 10:45 am oznow Hi Belinda I think you need to apply a new loan (personal loan?). Probably other could give more information. As the rate for personal loan is much much higher, certainly won't recommend a personal loan! Re: Home loan question 9Feb 27, 2008 3:03 pm hi vanderlay,
how come u had an extra 13k left? did the builder over estimate on some of the stuff that 13k was left unused? are they honest enough that they won't just pocket the money? Re: Home loan question 10Feb 27, 2008 3:16 pm dembi_2000 hi vanderlay, how come u had an extra 13k left? did the builder over estimate on some of the stuff that 13k was left unused? are they honest enough that they won't just pocket the money? Our loan was approved before we started building, so we had a little extra allowed, plus extra we paid off the loan while the house was being built. The build itself was a fixed price contract. Built Porter Davis "Dromana" 2007. Re: Home loan question 11Feb 28, 2008 8:17 am Similar to others, we've buffered ourselves to cover us for extras such as carpets, shedding, decking etc post-handover. The loan contract is worded such that the loan may be drawn down for the house AND ACCESSORIES. The other thing we did was to get approval to borrow more than we actually require to build just the house itself, not only by including a rough estimate of what we think we need for the extras but also by financing the deposit ourselves but still including it in the loan amount.
When you talk of extras, don't forget to include petty items such as the letterbox, clothes line, doorbell, TV antenna etc besides the big ticket items such as landscaping, extra furniture, fencing etc. It all adds up. Re: Home loan question 12Mar 18, 2008 1:50 pm Hi Belinda, these items would have to be included in your fixed price quote when you get your full approval for the construction. If you took a personal loan for them you may be able to consolidate this after settlement depending on the value of the property. This may incur extra fees and it would be best to discuss this with a broker.
Regards, Dean Lynch Principle Mortgage Consultant Australian Mortgage Brokers 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 18895 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 35191 How much are you ahead in payments compared to where the build is at? Have you fully drawn down the loan? 5 11893 |