How to raise the Money to build your own Home:
Building your own home is a way to get a home which may meet all your needs and may cost less than buying one already built from a developer. Financing this type of work can be a major problem but some mortgage lenders are able to help.
You need to plan your budget carefully so that you know how much the project is going to cost in total. The mortgage lender will ask for this and you need to make sure that you have covered all your costs such as land costs, professional fees, building work, materials, etc. Make sure you know what you can take on yourself and employ an architect, surveyor, planning consultant and project manager if necessary.
You are probably going to borrow a large sum which you have to pay back whatever happens to the building. You need to make sure that you hire a good builder in order to reduce the risk.
Getting the right insurance and warranty cover is also vital so that you can be protected against some of the risk if things go wrong. You will also need to cover your legal expenses. It is essential to include an amount for contingency - to cover unexpected costs which might come up
There are two types of mortgage which could be used. The first option is a traditional arrears-based mortgage released in staged payments on completion of each stage. The second option is an advance payment scheme which releases funds in advance of each stage of construction and removes the need for bridging loans. The stages can be fixed or flexible but there are usually five and these depend on the type of building work. Not many mortgage companies will offer an advanced payment, this is due to the risk involved.
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