We are currently progressing through the construction phase of our build, and now have some bricks. Yay! As we approach the end of the whole process, we have become a little concerned about Bankwest's "minimum levels of fit out" requirements - see below:
For all applications where properties are to be constructed, a minimum level fit out is requ red and summarised as follows:
Where an owner occupied property is to be constructed:
• Basic front landscaping
• Driveway to council crossover
• Boundary fencing
• Window treatments
• Floor coverings
These items must be either:
1. Within the building contract and/or be evidenced by quotes and/or invoices provided at the time of the application being received and sent to the valuer for inclusion within the on completion valuation report.
OR
2. To be evidenced as being able to be completed by taking into account the availability of surplus funds following the payment of required fees and contribution and listing the individual outstanding items and the cost to complete each of these.
Note that the provision of all required documentation to the bank at the time of the application and forwarding to the valuer, enables itemisation within the valuation report and inclusion within the on-completion value amount.
Where all or some of the minimum items are not included within the on-completion valuation report and are to be finalised by the applicants once constructions has finished, mitigating comments must be included to confirm that the property will be fully completed to meet the minimum required level of fit out from the originator listing or the application will be stopped pending receipt of:
1. The individual outstanding item (s), AND
2. The costs to complete each of these
To be honest, I don't fully understand the content of this document...
At the time of applying for the loan, we believed that we had each of these items covered - the developer is providing basic front landscaping and boundary fencing, the crossover was added to the contract with the builder, and we provided quotes to Bankwest for window treatments and floor coverings so that they could be included in our loan. However, it soon became apparent that the costs of the window treatments and floor coverings had been omitted from the loan, and that we would probably need to finance these items ourselves. Unsure about whether this was an error by our broker or lender, we approached the broker, and he told us not to worry as we could add additional finance once the house was completed. As we had already paid our first progress payment, we were unable to change the terms of the initial loan. Since then, we have done a bit of reading on these forums, and it seems that other people have experienced similar issues, with Bankwest missing things like this off their loans too.
We hope that this will not be a problem. However, given our lack of understanding around how the final handover part of the process will happen, we are stressing out! Will the bank require the house to be completely finished before they provide additional finance? If so, they won't provide the finance as the house will not be finished. Presumably the lender will send someone out to inspect the house and check that we have complied with their terms and, if we haven't, they will not pay the final progress payment to the builder, who will not give us the keys until they receive the money. Fair enough.
To complicate the matter, we are already working on a pretty tight time scale with regards to the construction time frame (completion due in March), as we have family coming to stay with us at the end of March/ beginning of April, and we don't really want the handover to drag things out for too long. Add into the mix that we are currently paying rent on a 1-bed apartment in the city, which we could really do without.
Becoming very concerned about this, and not really sure who to talk about, we asked the broker, but he has gone quiet and ignored our email. Are we likely to get any information from a home loan "specialist/ department" in one of Bankwest's branches, or would we be best to call their contact centre? Either way, I can just imagine that nobody will know the answer, so we will be passed around to different departments/ people.
We are hoping that someone on here may be able to shed some light on the situation, or point us in the right direction. Has anybody else found themselves in the same situation as us, either with Bankwest or a different lender?
Thank you in advance.