New builds and mortgage completion

daniejam

Hi, I am in the middle of buying a new build, i have a plot, AIP and i am currently in the process of applying for the mortgage with a view to exchange contacts before 9th March.

I have a meeting with house builders for what extras i want in my house, obviously with most new builds this can get fairly expensive even though they are giving me £8,000 towards it.

My question is, once the contracts have been exchanged, is the house 100% mine? I am running quite close to my affordability check by the bank, and essentially i want to go take a loan out or use an interest free credit card once i have exchanged contracts to pay for the extras for the house.

I cant take this loan out beforehand, as it would jeopardise me getting the house.

Would it be safe to do this once the contracts are exchanged? Or would i be risking the house and just have to make do without?

Thanks in advance for any help! it is appreciated.

silvercar

Nothing is guaranteed until the mortgage money is drawn down. Lenders can and do re-assess before drawdown, so I wouldn't take any loan until then.

daniejam

what is the drawdown? and when would it occur? Sorry i dont know much about this!

chunkytfg

daniejam wrote: »

what is the drawdown? and when would it occur? Sorry i dont know much about this!

Its when your Solicitor asks for the money from your mortgage lender and they send it to them.

daniejam

So that probably wont be for a while if i dont move in until October?

Ill ask the solicitor just to make sure but thats a bit of a bummer Guess i will have to try and find some other way to sort it out.

Thanks for your help.

chunkytfg

daniejam wrote: »

So that probably wont be for a while if i dont move in until October?

Ill ask the solicitor just to make sure but thats a bit of a bummer Guess i will have to try and find some other way to sort it out.

Thanks for your help.

Once you've exchanged contracts you are legally obliged to complete on the deal so taking out extra credit thats likely to impact on your mortgage offer is unwise IMO.

also if you apply for a mortgage now and exchange by the beginning of march your looking at 8 months from mortgage offer to completion. Be warned that some mortgage offers only last for 6 months so you may need to either reapply or get an extension to your offer which isn't 100% that they will give you one.

Are you using a Mortgage broker? Might be worth contacting one for advice?

daniejam

I am using a mortgage broker and the mortgage offer is for 9 months. So that shouldn't be an issue.

Guess i will have to do more work to the house once i move in haha!

chunkytfg

daniejam wrote: »

I am using a mortgage broker and the mortgage offer is for 9 months. So that shouldn't be an issue.

Guess i will have to do more work to the house once i move in haha!

:beer::beer:

In that case good luck:beer:

kingstreet

No new applications for credit between application and completion.

Annie35

You may find you have to pay for extras upfront (over your 8k given).

There's also semi regular threads on people who for whatever reason pull out of purchase don't get a refund on extras paid for.

So do double check your contracts & go easy if there's any doubt

lee111s

Get the work done after you move in.

You’ll be able to decide if you actually want/need it... if you do, you can then pick your tradesman and the fixtures and fittings. Probablt saving yourself 50-75% of what the builder will charge.