Buying A Home
Dear Community,
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Rural new build?
Hey, I'm brand new here. My husband and I are starting to research buying a house, and we came across some plans we would like to purchase for a contractor to build. I know many of the details will vary by location, but I feel really in over my head in terms of even where to begin. We will be saving up for a few years but we're just in the research phase and I'm wondering what to expect.
My biggest question is, if we want to purchase land and then have the home built on it, how does the mortgage-qualification process go? Can we get a mortgage on a house that isn't built yet?
Re: Rural new build?
We were looking into building for a while, but our perfect house came on the market so we went with that. They have new construction loans that you take out before you start building. You will also need to look into homeowners insurance to cover it while it is being built.
Good luck and enjoy the process! It is exciting and stressful but so worth it!
Thanks for the info, that's awesome!
Some builders will do a "land-home" package for you. They will in essense buy the land in advance, build the house, and then you only close once on the home.
We were originally looking at building and then realized there were too many unknowns to do it comfortably with a limited budget. If you are going rural and need things such as a septic and a well, there are many unknonwns, especially if clearing land is involved. I would suggest speaking with a builder, seeing if the "land-home" package is an option for you, and then get prequalified to see what you can afford. I would suggest not maxing out your prequal when you start doing that math and leave a fairly large cushion for the unknowns that will come up later in the project.
There are numerous lots around me that have half built homes and then they go into foreclosure because the owners run out of financing half-way through the build, so please be cautious and work with a reputable builder!
Thank you for the advice. That is kind of bothersome and exactly what we were afraid of. It's freaking me out a little. I guess we'll have to think things through more and figure out what level of risk we're comfortable with.
Hello,
I work for a contractor and my husband and I looked at doing this very thing before finding "the house" for us. Many banks don't do construction mortgages, and some will do it for as little as 5% down. Working in the construction business, you may be able to negotiate a fee with the builder for them to carry the cost of the home on their line of credit and sell you the home for one lump sum upon completion. I would say calculate your entire cost of construction in phases, and do interest rate + 2% as a fee. So your fees in the beginning are very small because they haven't incurred much cost yet, and they go up during the construction process. A traditional construction loan will have a higher interest rate than a conventional mortgage, so it really will pay for itself just to finance conventionally if you can afford a few bucks on the front end :-)