Owner Builder Loan
When applying for an owner builder loan, banks are looking for detail.
They will require the job to have quotes for all trades and products. The other requirement by the bank is for the client to have funds to cover 20% of the build cost and a further 20% of the build cost to cover contingency for any over-run in the build cost.
The bank wants to avoid the client running out of funds with a build that requires further funds to complete.
Once the loan has been approved and the project starts, the client will use their funds for the build and then the bank will reimburse for each stage of construction.
The biggest factor Owner Builders need to take into consideration is time. The longer the build takes the more money this costs. Clients need a strong budget and work to a strict timeframe.
And if they can’t then they simply won’t enjoy the benefits of why they started in the first place; that is to save money.
Paul Blake is The Owner Builder Club’s resident Mortgage Broker. We like him because he has over 20 years lending experience and has helped many owner builder clients with their finance to build their dream. It also helps that he’s honest, down-to- earth and works hard for his clients. Paul’s with Citiwide Homeloans and if you wish to discuss your lending requirements, don’t hesitate to him on 1300 345747.