Thinking about building my own home but dont know where to start?

Question

Got some questions....
1.how does the money side of it work? when i am still in my home and i still have not sold it.Does the mortgage on the self build home depends on the value on the home im in?
2 .will i have to pay for the 2 mortgages until the new home is ready?
3.where do i start once i have got the land?

Answer 1

The first thing you have to do is acquire the land. Then you have to find out from the city planning & permits department what is allowed to be built on the land as far as single family or 1-4 units, condos, townhomes, commercial or industry.

Once you know the zoning you can make an intelligent decision as to if you want to purchase the land or not.

You will be required to pay your existing mortgage even after your new home is built until you sell it or turn it into a rental.

The mortgage on your existing home has nothing to do with the mortgage on your new home.

Normally you will not have to pay anything on your new home until your new home is complete and your permanent mortgage kicks in.

Now about the money portion. Most lenders will not lend you the money to purchase the land and then turn around and give you money to construct a building. So you will have to get the land. In your contact with the seller of the land if you have to pay monthly installments, make sure that you have some place in the contract that the land loan will subordiate to a construction loan.

Many lenders now will do both the construction loan as well as the permanent financing. That way you only have to fill out one application for the loan request. You will be given a construction loan to do the construction. After the construction is done it automatically converts to permanent financing.

I hope that you this is of some use to you, good luck.

"FIGHT ON"

Answer 2

You have to buy the land out of pocket. The first home can be financed so that there is money to buy the land and build the house.

This way the old house once sold, pays for the building of the new house. Chances are that the old house will not have enough equity in it to completely build the new house. If you don't have the cash laying around to do the whole job, do a partial. You can put in 1 of 3 bathrooms, and the barest needs in the kitchen. After you move in, the other work can be completed.

Construction loans for this kind of project is not very available, as far as I know.

Answer 3

I would first place my current home on the market...

The house that I am planning to build, I would start.. Now, this may be called putting the cart before the wagon BUT I think that you should sell your home that you are in now.

Recently, a friend of mine had the same problem.. They purchased a home in a new development.. There current home had been on the market for 3 months and still no sell. As the time to move in the new home got closer, they panicked.

Fortunate thing occurred, the house sold 1 week before the scheduled move. Call that "cutting it close"..

I asked, what would you have dione differently? His response, place the current house on the market as early as possible, even IF there current home was still being built they could have moved in a hotel and paid storage fees (this is what they were trying to avoid) BUT even still the current house would have been sold and no TWO mortgages.

As for you, try an get your current house sold and if you can afford to start building your dream home NOW. You just need to make sure that your asking price is reasonable, in tip-top shape, and that you see a profit. Time can be both your foe and your allie in cases like these

Actually, with today housing market there are so many avenues to choose to get your home sold. Be creative.. There are many pre-approved buyers who are looking for a great deal and the house of their dreams.

Do your research BUT just make sure that you evaluate your time well and you can have the best of both worlds. A sold house and living in your dream home..

AND 1 mortgage with money in da bank which should be your ultimate goal.

Best wishes!

Answer 4

In the US a very large percent of ALL small business are run from the home . Retired people are a good resource. Get your phone book and look in there for ideas. If the local economy already has one such business chances are a second one will also suceed.There are exceptions. Dance schools generally considered no profit. The home daycare business is ideal since you already have 2 kids on board. Bookeeping services if you like accounting. Anything that can be done by telephone is good. I love E bay. E bay can be done for very little money up front. Sewing is "extra" money and not generally prfitable. You will be working 20 hour days for below minimum . People refuse fittings and won't pay you. mending clother and small alterations are more profitable and have set fees that customers know about. More money that custom work. hemming jeans 1 pair 12$ takes 7 minuites. Button 2$ 1 minuite. But dressmakeing? hours and hours and no wages! Among arts and crafts only jewelry is showing a profit in online businesses. Jewelry you can make at home. start with Dover Books old time book on jewelry makeing. (Tools: bench pin, jewelers saw, blades,drill, files, Just cut sheets of brass or silver and make intresting dangle earings, drill the holes, buff them and put in the wires , no solder! just simple hand tools artistic designs and skill , take picture sell on E bay. Easy) There are hazards that must be kept from kids though !!! > heavy metals,The copper in brass dust, asbestos, polishing dust ect. Ventilation a MUST. A respirator with easy flow solder.any craft with metals or VOC's. all this stuff cannot be in the house where you have kids, eat or sleep. out in the garage , a separate room far from food prep erea. Sell perfume . Talisman Perfume company ( sells Madini perfumes) and Attar Bazaar (2-A's) are two that do not require much start up. They are both in the USA. The telephone the computer both suggest an online business. Search > micro credit Best of luck to you sweetie!

Answer 5

the way my brother did it was, he bought the property first ,and then did a little at a time ,started by getting permits for plumbing and electrical and gas, and then he put in the blocks. then the floor .waited and built the walls. all this was just him and me and my daddy on the week ends. after about a year he finally got the roof on and tarpaper on the walls (what we call blacked in ) not complete but out of the weather so to speak. ,just a shell. then he was able to go to the bank and get $20K just like that to finish it!

Answer 6

Yes to 1 and 2 and planning permission for no 3 I would see if you can get planning permission for the third first befor you even consider

Answer 7

at the bottom then work your way up- sorry couldn't resist