Critical Thinking. It’s the characteristic which defines us as human beings. It’s the same characteristic which is vital to the ultimate creative challenge: the design/build process for residential construction.
Building a custom home means creating a home style which matches your life style. You want a home to reflect your character, your values, your environment. A home as original as you are.
What are your rights? One resource to discover how the lending system works is the Federal Reserve Board. Under the heading “Consumer Information” their home mortgage article begins with this admonishment:
“Shop for the mortgage package that best meets your financial needs. If you apply for a mortgage and the lender says you don’t qualify, keep in mind that some lenders have stricter credit standards than others. Try someone else. Don’t stop shopping after one discouraging experience – or even several.”
Where can you get good advice? As part of the decision making process, speak with an attorney, certified public accountant, or realtor not associated with a lending institution. Be careful before you act on any expert’s advice! A good professional can help you save time, money, and headaches, but you have too much at stake to trust an expert to do your homework for you.
One good source for up-to-date information is HSH Associates. HSH Associates is the world’s leading publisher of mortgage and consumer loan information. They don’t make loans — they report on the terms offered by lenders across the country. However, you’ll also benefit from their “Library ” and “Author’s Corner” as well as links to other sources of information.
What will home building cost? Start by guesstimating these costs:
+ Buildable Site + Home Design + Construction Cost + Cost of Financing _________________________________________ = TOTAL COST TO BUILD YOUR CUSTOM HOME
These costs taken in combination will determine the amount you may need to borrow. For example, in regards to a buildable site, you not only must consider the asking price for the lot, but you must also consider the total expenditures to develop the site in order to build. Each site is unique requiring different expenditures so this specific dollar amount will vary from site location to site location.
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Keep in mind that this aggregate guesstimate is only a “working” figure. There are many variables to consider which can affect the total cost, but you’ve got to at least create a beginning point from which to proceed. Match the dollar amount for which you are pre-qualified with your best estimate of the total cost to build your home on the site you choose.
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