Financing Your Build
1. Arrange finance to purchase a section and have preapproved finance in place to build the home. Remember to allow for lighting, carpets, curtains, driveway, paths, decks, grass and fencing and other landscaping items
2. Buy the section
3. Decide on suitable plans with your builder/architect
4. Get a valuation, using the house plans and building specifications you have chosen for your new home. This is where an independent property valuer reports to the lender on what the property will be worth once complete. To do this they look at your plans, specifications and your vacant section
5. Take a copy of your building contract to your lawyer
6. Once you are happy with the building contract arrange for a copy of this to be taken to your finance professional so finance can be confirmed
7. The building contract is normally confirmed at this point with a deposit paid to your builder. If you do not have the available funds to meet this then speak with your finance
professional for guidance
8. Progress payments commence
9. Nearing completion of your new home you will be advised of a handover date. It’s really important you advise your finance professional of this date as early as you possibly can. The handover date is where you get the keys to your house in return for final payment. For the lender/bank to release these final monies they will need:
- A copy of your house insurance starting from the date of handover. Your insurance must include your lender as an interested party
- A completion certificate, provided by the valuer, so the bank knows the house is fully completed
- A Code Compliance Certificate, which is issued by the local council. Your builder would normally arrange this once all work is complete
Go here for more information on financing your build...
Third Party Builders Guarantees
Building a new home is probably the biggest investment you’ll ever make, and if anything goes wrong it could be the most costly too. It makes sense to reduce your risk by having an independent builders guarantee in place, just in case something does go wrong.
This will help you finish the build, and fix any defects, if something happens and your builder isn’t around to do so. Some mortgage lenders now require them before they will give construction loan finance. See our Third Party Builders Guarantees page for more information.