Jul 10, 2017 12:05 am
Just had a quick question in regards to applying for a construction loan.
My wife and I have land that settles in December 2017. Where we will probably start paying this land loan around Dec 2017- Jan 2018.
We are looking at locking in prices with Metricon for 8 months from September this year, where we want to start building in May 2018.
My question is, if we plan to build in May 2018. When would we need to start applying for a construction loan? And when would we need unconditional approval for the construction?
Can we wait till April 2018 to get unconditional approval for the construction? Or do we need this from when we pay the first holding deposit?
Help would be much appreciated
Re: Time Frame of when to apply for construction loan?2
Jul 10, 2017 11:23 am
Generally approvals last around 90 days now, most often you would want to be ready to rock as soon as you settle on the land which means getting the approvals done in advance.
Do you have conditional approval for the build - approval that says you could potentially borrow that much subject to the valuation being ok? I would be getting this done ASAP so no nasty surprises. That said, lending is changing rapidly so you may still want to get the unconditional approval ready a little sooner than you mention so you have time to make any changes if necessary.
Best of luck with the build
Property crazy expert mortgage broker, love building new homes!
Two Red Shoes mortgage broker
Re: Time Frame of when to apply for construction loan?3
Jul 10, 2017 3:51 pm
There are some lenders that will allow you to construct your property and drawdown a loan up to a year after land settlement. So if you have all the drawings, contracts, etc with land settlement in Dec/Jan and you know it will be finished by the following Dec/Jan, then you can get it organised and unconditionally approved the same time as the land even if the start build time is a few months down the track.
Phoenix Loan Consulting
www.phoenixloans.com.au | Ph: 0409 799 372
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