Browse Forums Home Finance Re: 100% Construction Loan 8Oct 10, 2008 12:51 pm Blog - http://clageonewhouse.blogspot.com/ Building Thread - viewtopic.php?f=31&t=10886&hilit=milan I am in, with my husband and my beautiful bunny Re: 100% Construction Loan 13Oct 10, 2008 3:37 pm Wonderland even though we bought the land and paid cash for it the builders weren't interested in us getting to the contract stage unless we could prove we had the full amount for the house. Including any finance for the house. Since we intended to borrow approx 35% of the house build costs we had to get our finances sorted before we could get to contract stage. By the time we got to the contract signing stage they'd already seen proof we had the cash + loan to cover the build.
We also had the bind of building in the country. Land here is valued differently and lenders will only led a small % of the value of the land if it is your only surely. I can't remember what percentage now but its not a lot. Our land value came back at 20k below what we paid ( and this was despite us fighting hard to get a good price for our land and paying 15k below the asking price) We actually would have been out by 10 k but because at the time the lenders where struggling to find people borrowing they relented and gave us slightly more borrowing power. Enough to make up the 10k difference. Perhaps we might have had less dramas if we'd been going for a standard mortgage loan but we went for an equity loan. Upshot is if we want to at a future date we will redo the loan and it will be based on the value of the house and land. Re: 100% Construction Loan 14Oct 10, 2008 3:57 pm Kexkez - yep different areas may have different lending criteria. Rural properties / large parcels / areas in small "difficult" places all can affect lending value. From memory rural was sometimes capped at 60% with no possibility of even getting mortgage insurance.
Wonderland - so sorry to disappoint you but most bank's these days don't give out big discounts to staff. They did 19yrs ago when I started - from memory when interest rates for public were at the 12% staff were around 5% - however you had to have been employed for 7yrs and could only borrow 2.5 times your salary value at staff, the rest having to be at public rates (and bank staff are not highly paid!!). Nowadays they tend to let you borrow the maximum amount (ie 95% with mortgage insurance, 80% without mortgage insurance) at a discounted rate which basically anyone can get - ie Westpac's discounted rate for staff is the same for anyone in the public borrowing over $500k on variable rates. They figure that very few people will hang around in a low paying job for 7yrs so offer the discount as soon as you finish your probation period (normally 3mths after starting). Max discount from memory is 0.6% off the public rate. Re: 100% Construction Loan 15Oct 24, 2008 8:26 pm Land got settled recently. I told CBA that I will be building soon and they have ordered a valuation of the Land + House. Land valuation came up $9K higher than the previous one and they also gave 100% value to the construction costs. They're giving me 95% LVR which means I just need to come up with $6K to cover the shortfall, plus I'll get the FHOG in the latter stages.
I need to pay the 5% deposit being asked by the builder though in order for site start to happen while the bank organizes the release of funds. They asked me to keep the receipt and they'll refund me this later. Can't wait to have a definite site start date. No deposit house and land loan 16Mar 06, 2009 3:25 pm 100% Construction loans are no longer available after big changes in lending policy again last week.
You may still qualify for a No Deposit home loan for house and land package to have your perfect home rather than buying an established property. To apply for the No Deposit home loan you will need; *Contract for Sale of Land *A fixed price contract from a licensed builder for the construction *Council approved plans and specifications of the proposed house *A copy of builders current insurance policies On presentation of the above, the building project is valued before loan approval and monitored through its stages by the lender; *Tentative value of your completed project is estimated *Lender’s valuer monitors building progress and confirms the completion of each construction milestone, while the lender progressively pays (progress payments) the builders invoiced claims *Receiving builder’s invoices along with a request for funds at each major stage, your lender manages the financing of the project in stages. Re: 100% Construction Loan 17Mar 06, 2009 3:28 pm What is the difference between 100% construciton loan and no deposit home loan? Re: 100% Construction Loan 19Mar 06, 2009 3:38 pm Let me qualify that answer, thee is no difference between No deposit and 100%.
Of course there is a difference between Construction loan and home loan. Construction loan is a specific type of home loan. (Maybe I didnt need to spell that out?) Re: 100% Construction Loan 20Mar 06, 2009 4:12 pm gpierce CBA told me that during construction they will inspect and do valuations at all the payment stages before handing over the $$ to the builder. In my case, we already own the land, and the loan won't be more than the land alone is worth, so in our case they WILL loan us what we need, but they'll still do a valuation. Greg Not sure if CBA inspected the house at each stage but from Slab to Fixing Stages they were able to release the funds in 3-4 working days. I've been told that for the final stage payment, they will need to actually go onsite and check that everything is in order before releasing the final cheque. 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 18897 That sucks! Hope it all works out. Good to move away from steel anyway for all your reasons, but it's also thermally poor. 16 17774 As is per usual for many of the past failed RWH regulations, it is probably traceable to a bureaucrat who's ego overrode the need to seek the appropriate expert… 1 794 |