What Does a Contract Builder Need to Provide Me with to Obtain Approval from My Mortgage Provider for a Construction Home Loan?
Potential borrowers and homeowners who are researching the various aspects of home loans may want to know what a contract builder needs to provide them with to obtain approval from their mortgage provider for a construction home loan. A borrower’s contract builder will need to provide them with various documents in order for the borrower to obtain construction home loan approval, including the following examples:
- The building contract outlining the stages of construction, the length of the project, the project’s estimated final cost, and the payment schedule
- The project plans to allow the borrower’s mortgage provider to understand the extent of the project
- The project specifications to allow the borrowers mortgage provider access to information necessary to complete a valuation which is required to determine borrowing power. Project specifications generally include materials used, quality of workmanship, and appliances that have been installed
- The quotes for smaller projects being completed, including driveways, power poles, pools, retaining walls, sheds, and landscaping
- The contracted builder may need to provide a borrowers mortgage provider with proof of builder’s insurance before releasing the first drawdown payment
It is essentially important that a contract builder provides their client with the information and documents stated above to ensure their mortgage broker is aware of the projects total cost and approves the funds necessary.
Individuals who would like to learn more about construction home loans or are ready to apply for a loan should reach out to the Mortgage House team for further information as well as specialized assistance and advice throughout the application process.