Your home is your castle and a lot goes into a new home construction. You may just be starting to research about building a new home. Where to start? A great place to begin is always with finance. Speak to a Mortgage Broker or your preferred lender, you may be able to get pre-approval early, so that you can know your budget for house and land.
Of course, even if you don’t have your pre-approval as yet, we are happy to meet with you to discuss your new home ideas and start designing your home, simply contact one of our friendly Jazz Homes Design Team.
You may find yourself wondering, what exactly is a Construction Loan, and how does it differ to a ‘standard’ Home Loan?
Basically, it is just a standard home loan, but with building/ construction conditions applied.
Your mortgage broker or lender, carefully review your personal circumstances and financial capabilities just like with any loan. They also review your home building plans, selected block of land and perform a ‘as if complete’ valuation – an estimate of market value of the land and proposed home.
Other documents most lenders and brokers require for formal loan approval may include:
Once everything is approved by your lender / broker and your loan is approved, the total loan amount is ‘drawn down’ in 5-6 progress payments, paid to us, your Townsville new home builder.
General progress stages of new home building with Jazz Homes include:
During the construction period of your new home, you generally cover the interest only on the amounts drawn on from your loan total. For example: You have been approved for a loan of $450,000; your bank pays a deposit of $10,000. One month after the first payment is ‘drawn’ from your approved loan total – you pay interest on this amount (and any progress payment fees that may be required by your lender/bank).
You may need to pay one last interest payment, on the day your final progress payment is made on your home. The loan is then converted from Interest Only, to a Principal & Interest loan and your lender will advise you in writing, what your monthly repayment requirements will be.
If you are considering building a new home, contact one of our friendly Jazz Homes team. Even if you don’t have finance approval just yet, our new home design team can start working with you to design your home during the pre-approval process, obligation-free.
Disclaimer – This information has been put together as a general guide only. You should consider your personal circumstances and obtain formal advice from a Mortgage Broker or other Financial Institution. Banks, lenders and financial institutions may differ in the structure of Construction Home Loans and you should always refer to advice and/or conditions specific to your Bank/Lender and/or loan product.
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Harris Crossing Display Village
11 Broadmeadows Cres,
Bohle Plains 4817
Free Call 1300 805 255
07 47 233 362