Things to know prior to building

             

What you need to know before starting this process:

There are several things that are useful to know if you are considering building a custom home. This is a big undertaking and you need to make sure you are in the right position to do this. If not, it may be better to take one of the following courses:

• Rent and build up a good down payment/extra funds
• Buy a market home as a starter and build later
• Build with a "big builder" as this is typically fairly similar to buying a market home in terms of down payments and mortgages.

Here are some further tips that would have been helpful to us and hopefully will help you:

• Most construction loans require a minimum of 20% down payment. There are some lenders that will offer as low as 10% but these days they are VERY hard to find. Talk to your builder and ask if they know where to look for construction loans as they deal with these lenders for most of their projects.
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• Make sure you can find affordable land prior to getting caught up in finding a builder and designing a house.
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• Make sure you have a significant amount of money set aside for things you think of throughout the process that you want to buy yourself and have the builder install. Also, don't forget to budget for new furniture if needed and blinds for the whole house.
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• Do your research when it comes to choosing a builder. How long have they been in the business? What is their reputation? Do they build energy compliant homes? Can you see examples of their work? Is there anyone who has used them before that you can speak to? Don't be afraid to meet with multiple builders to discuss your plans and get quotes.
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• Make sure you get every step and every quote in writing. There are many fine details and you want a paper trail of it all.
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• If you don't know your builder/don't know much about building or real estate I recommend you get a real estate agent. It pains me to say this as I found out my builder was extremely trustworthy and I basically wasted a few thousand on a realtor who didn't do much of anything for the process since our builder had everything under control. That won't always be the case.
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• Reading blogs is always helpful as well. See some of the comments under my posts as many of them also have very helpful tips! There are many other sites out there that provide similar information such as 5 things you need to know when building a new home.
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• When making a floor plan it is often hard for some people to picture what it would look like. Search for software that would allow you to create a 3D model. This can be time consuming to put together, but helpful if you are struggling to visualize what the completed plan would look like.

If anyone has anything to add, please feel free to leave your comment below. Everyone learns something different throughout the process, so feel free to pass on your knowledge!