No Deposit Home Loans - 95% Construction

No deposit home loans have been a commonly used vehicle for people to purchase an existing property but even if you are looking at constructing there is a no deposit home loan which provides 95% of the price which includes the land and construction component.

Many first home owners and people simply wishing to build their own home have used the no deposit home loan for construction to do just that.

It should be noted that with the Credit Issues being experienced Globally, Lenders know require applicants to show 5% genuine savings for any loans that are above 85% Loan to Value. Although Lending institutions will still consider applicants under a no deposit scenario, it is of utmost importance that you can demonstrate a 5% savings pattern over a 6 month period.

For further information we recommend, prior to any purchase that you obtain a pre-approval, ensuring that the Lender of choice is comfortable in providing you with the finance to purchase your First Home.

You can contact us for more clarification.

First home owners benefit even more as the grant itself can be advanced by the home loan provider to fund the laying of the slab. The first home owners grant needs to be approved by the government before this occurs but it is a unique option only available through the no deposit home loan for construction.

Existing home owners also benefit by way of the no deposit home loan providing upto 95% funding required to buy the land and construct, what this does is allow the existing home owner to sell their property and utilise any funds to pay for stamp duty and associated costs of purchase, or pay off other debts such as credit cards or personal loans.

Many people are now choosing to construct their own home on new parcels of land that have become available, either in new estates or land which is in a location that suits their lifestyle.

There are many reasons that people choose to construct their own home, and there are some obvious benefits in doing so, below is a brief snapshot of some of these benefits and also other reasons why construction is a choice that many are making:

	Stamp duty savings as you only pay this on the land component
	You get to choose the style and layout of the home from a range of designs
	The location of your home is up to you as you choose the parcel of land and the location of the land
	You have the satisfaction of knowing that you are the only person who has lived in the home
	You choose the style of gardens and landscaping as there is a blank canvas waiting for you to design
	Affordability of a house and land package or construction on your land as compared to existing homes in an established suburb

As you can see there are many benefits of constructing your own home, more so from a personal point of view where choice is the key driver.

A no deposit home loan for construction is fully featured and provides you with the choice of home loan structures to suit your needs. Let’s take a look at the benefits of this type of home loan:

	Choice of either a fixed or variable home loan interest rate
	Ability for First Home Owners to have the grant advanced for the slab stage
	Branch network for greater choice of how you do your banking
	Cheque accounts, credit cards, offset accounts and many other features are available with the no deposit home loan for construction
	Covers your entire cost to construct and the purchase of the land
	Allows you to use either funds saved or the First Home Owners Grant to cover associated costs of purchase
	Choice of weekly, fortnightly or monthly home loan payments and internet banking facilities

No deposit construction home loans are literally the same as other no deposit home loans although the funding process differs. This difference is in the way in which the funds are released, rather than a traditional no deposit home loan where the funds are transferred on the day of settlement in one lump sum a construction home loan funds the construction in stages.

These stages are referred to as ‘progress payments’ and along the way there are also inspections by the lending institution which ensure the construction is built in accordance with council specification and on time.

Here is an example of how the progress payments are made as outlined below:

	Slab stage
	Frame Stage
	Roof and exterior walls
	Lock up (turnkey)
	Final settlement

As with all no deposit home loans, we are able to source the right home loan for your needs and provide with the appropriate comparisons so you make a more informed decision.

We can even assist in helping you find a home to construct which broadens your choice so why not contact us and have a chat to one of our home loan consultants.

	Useful Sites as a point of reference:
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