Building on Success with Self Build Mortgages
Self build mortgages are an excellent option for people who want a low-cost home, and they are willing to put in just a little hard work. This type of mortgage has many advantages over an old-fashioned home loan. For one thing, a typical home built this way is usually worth about thirty percent more than the cost of the mortgage. Then, there is the personal touch. When you can customize your home, select the layout, colors, styles etc. you are able to tailor the house to you, to your personality and needs. That truly makes the house, a home – your home!
Now, when doing a self-build, it is important that you carefully oversee and manage the project. That is your chief responsibility; not so much doing the actual work yourself. Although, if you are handy with tools, or maybe you have a carpenter or painter in the family; you can do some of the work yourself, and further reduce the cost of the home but be aware that some self build mortgages are not available to you unless you are going to get professionals in to do the work for you.
These days, there are many companies out there that can help you with self build mortgages; a quick search of the Internet will yield a good starting list. They will give you advice on everything from finding the right lot to buying the building materials, to getting the loan and hiring the builder. All these things are important, and need to be done in the right order, at the right time, and in a timely fashion. You don’t want to pour the slab for your foundation, and then have it sit for a week – or longer! So, hiring a manager to help is a wise decision.
So, you decide to got for self build mortgages; how does it work? First, do a search for lenders that handle this type of loan. Traditional mortgage companies tend to only give loans on an actual house. But, these days, you can find firms that will lend you the funds to buy a lot and build a house. With one of these loans, the funds are given to you prior to the start of each stage of the operation. Typically, you can borrow up to ninety-five percent of the land cost, and the same for the construction costs.
Once you have the self build mortgage in hand, you take the next step: purchase the land. After that, there is the preliminary cost estimate, laying the foundation, putting up the walls and roof, then the rough interior work, the finish work, and completion.
And, there’s no need for you to first sell the home you’re living in and have to live on-site – maybe in a tent or camper! No, these days you can stay where you are and just keep the mortgage going while you build. Your existing mortgage is just treated as a business expense. Its only drawback: it reduces the maximum amount you are allowed to borrow. A good way around that is to sell and then rent a place while your new place is being built.
Also, it is very important that you be well organized when you start this project! Sitting down with an architect and drawing up plans, and estimating the full cost of the home are all vital. You want to be sure to include a contingency fund. Because, no matter how well you plan, the project will likely cost more than you expect. That is normal. In most instances, allowing for about ten percent more than you expect to spend on your self build mortgage is standard.
Please read some of our other interesting articles on mortgages below:
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