Browse Forums Home Finance Re: Loan for things outside builders contract 21Aug 16, 2012 5:44 pm CBA wouldnt let us add to loan, could only have a fixed price house contract. http://lindeman28.blogspot.com - Our building blog Re: Loan for things outside builders contract 22Aug 16, 2012 11:40 pm Good Luck Monz..........Its a terrible pity to be having all this hassel...........When you have not even started building yet! Building in Blackwood Park 2012/13 Land settled 8/8/12 Contract signed 6/11/12 Encumbrance approval 24/12/12 Development Approval 24/4/13 Slab Poured 8/7/13 Re: Loan for things outside builders contract 23Aug 17, 2012 7:22 am I know, it's ridiculous! And it's simply because of the person who we deal with no longer there. The same bank, the same branch. Thanks for all your advice! Re: Loan for things outside builders contract 24Aug 17, 2012 12:48 pm Hi Mon21, Really sorry this has been your experience, NAB does have this policy as do their offshoot, Homeside. There are other banks that will accept invoices for works outside of the contract but they need to be of a non-structural nature. For example, air con, driveway, turf, landscaping, floor coverings, blinds, patios and external sheds are all allowable. Other banks can include these in the valuation process which will in effect provide a better valuation and potentially no mortgage insurance (depending on your size of deposit). However, they will not allow structural or integral works to be completed outside of the building contract. If you had invoices for your own bathroom installation, kitchen or roof materials, banks will start to view the build as an owner builder which brings with it, significant restrictions of the loan. Most banks don't offer owner builder loans either. Sounds like the person you originally spoke to had their policy knowledge incorrect as their policy in respect to invoices outside of the contract hasn't changed in the last 8 years that I have been dealing with them. It's sad there is poor advice with these types of loans because they make up such a small amount of loans that are originated for construction. They are often misunderstood or misrepresented and you are the one that is affected. Hope it works out for you but there are plenty out there that allow additional invoices. Just make sure you also ask they take them into account for valuation as there are a few that will allow funding for these invoices but not take them into account for valuation purposes. It could result is a lower valuation. One other note based on a comment previously, there is no final valuation of the property at completion to ascertain its value. Banks will send a valuer out to ensure the property has been completed and has been built to the original spec as what was applied for (e.g. you didn't delete a bedroom to save costs or change bench tops back to melamine from granite). This means you would not have the risk of sourcing additional funds at completion if the value dropped. Hope this helps. Good luck with the build. Regards, Ian Re: Loan for things outside builders contract 25Aug 17, 2012 2:29 pm Hi Ian, Yes the issue is that because of the incorrect advice NAB given us, we have made our decision to source many things outside the builders contract. They are non-structural, such as floor coverings, driveway, blinds, where the price from the builder could be much more expensive. We spoke with another lender who can include those things as part of the loan, however advised us since we already have the land loan with NAB, if we were to move our loan to another lender we need to pay the LMI again. So basically we're stuck with NAB and having to pay lots of things that we didn't factor in when we took the loan, based on their banker advisor's advice, and all in writing. Didn't mean anything at all to them though. Re: Loan for things outside builders contract 26Aug 18, 2012 8:47 am Go the ombudsman - and let NAB know you are going there. They have to pay up to $4000 everytime the ombudsman gets involved just to investigate so they will do almost everything in their power to resolve the issue before it leads to that. Re: Loan for things outside builders contract 27Aug 18, 2012 11:43 am Really? They have to pay? Will we need to pay too? Re: Loan for things outside builders contract 29Aug 18, 2012 3:14 pm Hi all just reading all the threads here, and it may be a silly question because Iam new to this, but where would you stand with regards wanting a pool, would you be able to include that into the loan, it just that we bank with NAB too, so would be looking to go to them for advice once we get started, but reading this may be worth using someone else. Re: Loan for things outside builders contract 30Aug 19, 2012 1:20 pm Hi Caroline, I don't know for sure about pool, but you may want to clarify this with NAB first since it won't be part of the builders contract. I assume they won't allow it since that is what happening to us. May want to use bankwest or other lenders. Re: Loan for things outside builders contract 31Aug 19, 2012 10:36 pm I would suggest that it is highly unlikely that any lenders would be willing to include a pool in the finance package unless you have plenty of equity elsewhere. Definately worth asking the question but the banks are tighter than ever since the GFC. Building in Blackwood Park 2012/13 Land settled 8/8/12 Contract signed 6/11/12 Encumbrance approval 24/12/12 Development Approval 24/4/13 Slab Poured 8/7/13 Re: Loan for things outside builders contract 32Aug 20, 2012 12:58 pm the answer to this problem is a contingency in the contract. this is an amount included in the contract for you to do what you want. if you want to understand this one better ring leighton at clark new homes in lilydale vic Re: Loan for things outside builders contract 33Oct 04, 2012 11:36 am I was under the impression that you can have in included in your loan as long as you get written quotes from the suppliers as "proof" that the money is going towards the house. We've planned to get driveway, turf, aircon and fencing outside of the builder too, so I'm a bit worried now. Settlement: 10.02.13 Slab: 06.03.13 Frame: 08.03.13 Lock-up: 05.04.13 Handover: 03.06.13 Build thread: https://forum.homeone.com.au/viewtopic.php?f=31&t=59555 Brisbane Photography Re: Loan for things outside builders contract 34Oct 04, 2012 11:46 am I'd like to know the outcome of this. And monz - I know you asked the question ages ago, but I just thought I'd tell you we did get a pool included in our loan. We gave the bank a contract for the house, pool and land and it was accepted. With regards to the OP - we had most things included in our building contract (floor coverings, driveways, etc) but the rest (blinds landscaping, etc) we are just paying for ourselves...our loan amount is very specific and I doubt they will go over. I don't really mind paying for it upfront, a bit less interest charged from the bank later on never hurt haha 1st build: viewtopic.php?f=31&t=59376 *New*-2nd build: viewtopic.php?f=31&t=70324&p=1154282#p1154282 Re: Loan for things outside builders contract 35Oct 04, 2012 11:57 am Ours pays for the contract price. We have excess funds,but only realised that we could not use them when i applied to use some of those funds for the granite benchtops to be installed & paid for. Had to pay for them outta our own pocket lucky we had the money,but was not happy as those funds were to pay for something else Block bought 1st RBC X! 2nd Ventrua,Keeper! Pstart 18/7/11 Ethwks jan 2012 Slab Bricks- finished 7/6 Roof Trusses 15/6-cbond 21/7 viewtopic.php?f=31&t=41185 Re: Loan for things outside builders contract 36Oct 04, 2012 12:47 pm MalinViktoria I was under the impression that you can have in included in your loan as long as you get written quotes from the suppliers as "proof" that the money is going towards the house. We've planned to get driveway, turf, aircon and fencing outside of the builder too, so I'm a bit worried now. It depends on your bank, all of the big 4 banks only will do what's in the builders contract from my previous research and NAB experience. It may be different with different advisor, who knows? I don't trust their advise anymore. stellabella I'd like to know the outcome of this. And monz - I know you asked the question ages ago, but I just thought I'd tell you we did get a pool included in our loan. We gave the bank a contract for the house, pool and land and it was accepted. With regards to the OP - we had most things included in our building contract (floor coverings, driveways, etc) but the rest (blinds landscaping, etc) we are just paying for ourselves...our loan amount is very specific and I doubt they will go over. I don't really mind paying for it upfront, a bit less interest charged from the bank later on never hurt haha The outcome that the bank is prepared to do is only to include the builders contract on the loan, and they are getting us a personal loan with one month fee exemption for the other things. We haven't taken this up to the ombudsman as we want to get our loan finalised first as we are worried that this will drag it out further. So hopefully we can submit to the ombudsman next week. I don't see the reason why they can give us a wrong advise (written with details on how to do it!) and turn their back on their word, only because the original advisor is no longer working there. We are now wearing the risk and they are not even apologetic about it. I get all worked up again every time I think about this! Re: Loan for things outside builders contract 37Oct 04, 2012 12:56 pm I just remembered that I read somewhere that someone had actually asked the builder to include outside costs in their quote for the bank, even though these suppliers weren't working for them. But instead of the owners of the house paying these putside suppliers, the builders pay them for the product and labour. This can be an option to get around the problem, if the builder allows it. Settlement: 10.02.13 Slab: 06.03.13 Frame: 08.03.13 Lock-up: 05.04.13 Handover: 03.06.13 Build thread: https://forum.homeone.com.au/viewtopic.php?f=31&t=59555 Brisbane Photography Re: Loan for things outside builders contract 38Oct 04, 2012 1:16 pm We went with Westpac and I just provided the building tender as well all my other quotes for things that we wanted (eg, water tank, flooring, fireplace, excavation work). In the end they approved me for a set amount which I had asked for (it was 8k above the total build cost to assist with any 'surprises') so once the bank pays out the final payment to the builder, they are indicating they will put the other 35k into my savings account to get the other work done. Building tip No. 3: A raft slab will not get you down a river. A waffle pod slab does not go with maple syrup. My building thread https://forum.homeone.com.au/viewtopic.php?f=31&t=53000 Re: Loan for things outside builders contract 39Oct 04, 2012 1:43 pm MalinViktoria I just remembered that I read somewhere that someone had actually asked the builder to include outside costs in their quote for the bank, even though these suppliers weren't working for them. But instead of the owners of the house paying these putside suppliers, the builders pay them for the product and labour. This can be an option to get around the problem, if the builder allows it. Most builders won't do this as they are hold liable for the costs that is included in the contract. But if you can get your builder to include it, then it's great! barker We went with Westpac and I just provided the building tender as well all my other quotes for things that we wanted (eg, water tank, flooring, fireplace, excavation work). In the end they approved me for a set amount which I had asked for (it was 8k above the total build cost to assist with any 'surprises') so once the bank pays out the final payment to the builder, they are indicating they will put the other 35k into my savings account to get the other work done. Yeah, like I said, we were unlucky that the original advisor has moved on, I think if he were still doing home loans he could get us what was promised. This new lady that we're dealing with doesn't seem to know her stuff. Wouldn't even processed the loan until all the builders variations are in. I mean, we can still add things even after the build starts, what is the difference? I would be happy if we don't have to add in things for piering, etc. but very2 unlikely. Re: Loan for things outside builders contract 40Oct 05, 2012 3:49 pm Is it just me being really sick of my bank, but can anyone share their experiences with how your bank dealt with variations from the builders? Just spoke to my bank and she said I can't submit further variations from the builders, even when I get charged $ for piering, rocks, etc. It will have to come from my own pocket because they can't change the contract. From my understanding, as long as the variations come from the builder, there is no problem. 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 You talk about deletions, are they variations or PS and PC adjustments? pleas list them 1 16556 Depends what you're current inclusions are, but we're not including wardrobes and will just use second hand ones until we can save later on to get them built. Also have a… 3 11632 |