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House building process
Posted on 12/10/15 at 12:15 pm
Posted on 12/10/15 at 12:15 pm
How does it work? Do you meet with a builder and figure what you want for exterior and interior? Do they then come up with an estimate for the project? After that do you apply for a loan for that amount? What happens if they go over the estimated budget that you got the loan for?
Also, do you pay back the builder or is the whole thing sold to a mortgage company who you pay?
Also part 2, what is included in the total estimate? Everything but furniture basically?
Sorry for all the questions. I'm just starting to get an early idea on this stuff.
Also, do you pay back the builder or is the whole thing sold to a mortgage company who you pay?
Also part 2, what is included in the total estimate? Everything but furniture basically?
Sorry for all the questions. I'm just starting to get an early idea on this stuff.
12
Posted on 12/10/15 at 12:19 pm to King of New Orleans
find a location
find a builder
get a set of plans if custom or pick one of the packages they offer
the builder floats all the money until you close and the all in price includes his profit
builder will not start until you have a PA letter from a bank showing you qualify for the total
find a builder
get a set of plans if custom or pick one of the packages they offer
the builder floats all the money until you close and the all in price includes his profit
builder will not start until you have a PA letter from a bank showing you qualify for the total
Posted on 12/10/15 at 12:22 pm to DHS1997
quote:For a small starter house yes. Otherwise, absolutely not.
the builder floats all the money until you close
Posted on 12/10/15 at 12:24 pm to King of New Orleans
Find a location.
Get plans.
Take plans to bank and have appraised.
Get approved for construction loan.
Interview builders and negotiate a price.
Pay builder as work is completed, usually 4-5 payments as you pay interest only on your loan.
When complete get final financing for your home to repay construction loan.
Get plans.
Take plans to bank and have appraised.
Get approved for construction loan.
Interview builders and negotiate a price.
Pay builder as work is completed, usually 4-5 payments as you pay interest only on your loan.
When complete get final financing for your home to repay construction loan.
Posted on 12/10/15 at 12:25 pm to King of New Orleans
Good advice so far, but the best thing to do is contact a builder and ask him these questions. Then find another and repeat. Then make you own decision based on your new knowledge.
Posted on 12/10/15 at 12:29 pm to Btrtigerfan
If you aren't specific in your finishes, fixtures, and appliances your quote could vary as much as $50k.
Posted on 12/10/15 at 12:33 pm to King of New Orleans
Three ways a builder could do the job:
1) cost plus a %
2) cost plus a flat fee
3) one flat price to do the job (the contract will have details for what happens in the event there are changes)
Option three is once you already have plans and specs etc
1) cost plus a %
2) cost plus a flat fee
3) one flat price to do the job (the contract will have details for what happens in the event there are changes)
Option three is once you already have plans and specs etc
This post was edited on 12/10/15 at 12:35 pm
Posted on 12/10/15 at 12:58 pm to King of New Orleans
I built last year. There are a number of ways to do it. Here's what I would do if I were you.
1. Figure out how much you can afford to spend.
2. Figure out where you want to live locationwise. Either buy property or find some spec home neighborhood going up and go see about getting a lot there.
3. Find a plan you would want to build. DO NOT BUY IT YET. You can show it to a builder and they can guestimate cost based off just the cover of the plan.
4. Start interviewing builders and find one who can get you through this. Ask TD.com if they like said builder before you build to see if they're a potential scumbag.
The money part can vary depending on your financial situation and/or the lender. So go talk to banks/credit unions about that. They can help you start understanding the process.
I'd start arranging meetings with builders and/or lenders today. Just talking to people will give you an idea. You don't have to be ready or go with any of them just because you have a conversation.
1. Figure out how much you can afford to spend.
2. Figure out where you want to live locationwise. Either buy property or find some spec home neighborhood going up and go see about getting a lot there.
3. Find a plan you would want to build. DO NOT BUY IT YET. You can show it to a builder and they can guestimate cost based off just the cover of the plan.
4. Start interviewing builders and find one who can get you through this. Ask TD.com if they like said builder before you build to see if they're a potential scumbag.
The money part can vary depending on your financial situation and/or the lender. So go talk to banks/credit unions about that. They can help you start understanding the process.
I'd start arranging meetings with builders and/or lenders today. Just talking to people will give you an idea. You don't have to be ready or go with any of them just because you have a conversation.
Posted on 12/10/15 at 1:03 pm to DHS1997
quote:
the builder floats all the money until you close and the all in price includes his profit
LOLNO
Only if you are buying a spec but what you described is a hybrid of a custom and spec and pretty much shite advise.
This post was edited on 12/10/15 at 1:05 pm
Posted on 12/10/15 at 1:04 pm to DHS1997
quote:
the builder floats all the money until you close and the all in price includes his profit
Usually there is a construction loan.
Posted on 12/10/15 at 1:08 pm to King of New Orleans
quote:
Also part 2, what is included in the total estimate? Everything but furniture basically?
Whatever you ask for really. Here is a hint. The more you keep out of a cost plus contract the more $$$ you save. BTW you need to have at least 20% down(some banks will do 10% but most won't).
Posted on 12/10/15 at 1:22 pm to King of New Orleans
Unrelated question for residential jobs.
Do most residential contractors agree to liquidated damages? I.E. penalties for prolonging the job past a certain deadline? I know they are common for municipal jobs, but I always hear about residential contractors blowing way past their estimated completion date.
Do most residential contractors agree to liquidated damages? I.E. penalties for prolonging the job past a certain deadline? I know they are common for municipal jobs, but I always hear about residential contractors blowing way past their estimated completion date.
This post was edited on 12/10/15 at 1:25 pm
Posted on 12/10/15 at 1:28 pm to NYNolaguy1
20% still applies? I've been hearing that ppl are getting 100% finance loans and 10%
Posted on 12/10/15 at 1:32 pm to NYNolaguy1
You can have something in your contract with the general contractor for going past a deadline. It's important to do if you have a construction loan bc the longer the loan is out the more money you pay in interm interest.
Also, who ever said don't buy plans above is 100% right!!! Decide how much money you can spend first then talk to a a few builders. Understand the concept of living SF and underbeam SF!
Good luck I start on my house hopefully in 2 months!
Also, who ever said don't buy plans above is 100% right!!! Decide how much money you can spend first then talk to a a few builders. Understand the concept of living SF and underbeam SF!
Good luck I start on my house hopefully in 2 months!
This post was edited on 12/10/15 at 1:34 pm
Posted on 12/10/15 at 1:34 pm to HamCandy
This is all excellent answers. Good job OP, I needed answers myself
Posted on 12/10/15 at 2:04 pm to Btrtigerfan
quote:
Find a location. Get plans. Take plans to bank and have appraised. Get approved for construction loan. Interview builders and negotiate a price. Pay builder as work is completed, usually 4-5 payments as you pay interest only on your loan. When complete get final financing for your home to repay construction loan.
Most accurate post in this thread.
Posted on 12/10/15 at 2:13 pm to lsufan1971
(no message)
This post was edited on 6/25/17 at 7:44 pm
Posted on 12/10/15 at 2:13 pm to Btrtigerfan
quote:
Find a location.
Get plans.
Take plans to bank and have appraised.
Get approved for construction loan.
Interview builders and negotiate a price.
Pay builder as work is completed, usually 4-5 payments as you pay interest only on your loan.
When complete get final financing for your home to repay construction loan.
+1
Find the lot/land you want, but please pay attention to the restrictions, if any, before you decide to purchase.
Find a reputable draftsman to do your plans. Call local builders or even lumber yards for recommendations. If the house is complex or over roughly 3,000 living you may want to consider an architect.
Local banks are usually the best for construction loans
Hire a reputable builder. The lowest bid may not be the cheapest in the long run. Do NOT hire anyone in which you didn't get a couple recommendations. Many builders are good salesman. It's not only how they build the house, but how they address any issues after you move in.
Your bank will outline how many times you pay the builder (usually 4-5 as Btrtigerfan stated). In fact they'll send out an inspector to verify enough work has been completed during construction before they release the funds to you.
Mortgage brokers usually can give you better rates than the local banks on your permanent financing.
Posted on 12/10/15 at 2:16 pm to King of New Orleans
make sure you get the builders to quote you with the works. So when you don't have something you thought you would have gotten, you can say that this is all inclusive in the works package.
Posted on 12/10/15 at 2:18 pm to man117
I own a corner house lot in Southdowns that is totally paid for... recently i was thinking about knocking it down to rebuild a new house. I am right by Rouzan and I like those houses.
Anyone have an idea how much those house typically cost to build?
Anyone have an idea how much those house typically cost to build?
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