Gearing up to build your dream home is an exciting time! You’ve saved up. You’ve got a vision of what you want written down. You’ve decided on Southwest Homes as your builder. Now, it’s time to get the construction loan so you can get things moving and the home of your dreams built!
If this is your first time getting a construction loan, when you sit down with your builder make sure you discuss every aspect of what you want taken care of during the build, under the umbrella of that loan. There are necessities that need to be taken care of outside of the actual house itself that you can either choose to pay cash for or you can negotiate having your builder contract that work out. Your builder will include in the quote the items you want him to complete. Some people need a turn-key solution to keep things simple while others may want to pay cash for certain projects outside of the loan. Below are some items that could be managed by the client themselves versus having it included in the loan:
1. Land Clearing. If you are building your home on acreage that has trees, land clearing where you want your home to go, will be required. My husband and I did some of our own clearing, but it was a large job that we couldn’t handle all ourselves. We hired a company to come clear out underbrush that we didn’t want along with some trees that were going to be in the way. Just be sure to clarify what you want from the company regarding sizes of trees you want left alone, how many acres you want cleared, and where. This is the first step in preparing the land if you are building outside a standard neighborhood.
2. Dirt Work. Additionally, if you are building out on a piece of property rather than a neighborhood lot, there will be dirt work ahead of time required in order to get the home build started. My husband and I purchased 6 acres outside of town. In order for construction vehicles to be able to get to the spot where we wanted the house, we needed to bring in someone to create an actual drive. After clearing a path for the drive and smoothing out our dirt “road,” rock needed to be laid and packed down so the cement trucks that would later pour our foundation, didn’t get stuck in the mud. This kind of pre-work is necessary and the longer the drive, the higher the cost for labor and supplies.
3. Utilities. Does the location already have water and electricity run to it, or will that need to be brought in? The property we purchased had water and electricity to the front of the property, but we had to have it trenched to run both lines up to where the house would be. You also need to find out if the property already has a water meter on it? If there currently is no meter, a meter will need to be purchased. Pricing varies greatly depending on who supplies the water. Your electric company will also need to be contacted to get power going for construction. In our case, a permanent pedestal was installed rather than a temporary source -this was easier for the electric company because it meant they wouldn’t have to come back out again and turn the temporary power into permanent power. It also meant the meter wasn’t on our house -it’s out away from the house on the pedestal. You’ll need to discuss the potential options and what the best choice is for your build. In addition to just water and electricity, propane may be a need for you as it was for us. At our property, propane will run our range, fireplace and tankless water heater. If this is needed, you will be responsible for contacting the propane company to get a tank set up. We had the option of purchasing a tank or renting one. The rental price versus the purchase price made it much smarter to rent it as it would take 12 years of rental fees to equal the cost of purchasing our own tank. Renting also leaves any tank failure responsibilities on the company from which you rent, rather than on you. Research your options and see what the best choice is in your area. Water, electricity and propane/gas source are all set up by the consumer, rather than the builder so there’s no need down the road to transfer utilities from the builder back over to the owner. Setting it up yourself saves everyone time. Just be sure to communicate effectively with your builder as to the timeline for when each of those things needs to be completed so the build isn’t waiting on you.
4. Phone/cable/internet. Is the infrastructure available where you are building? What are your choices? We didn’t have the option to put cable where we built so we had to research other options. Do you want a land line or will you only be using your cell phone service? These last items aren’t critical to your build, but should be researched ahead of time. If you office out of your home and don’t have the infrastructure you need to effectively work in the area in which you are looking to build, you may need to consider a different build location. Although, if you’re in love with the location, you may need to commute!
5. Landscaping. This one is pretty self explanatory.
So, in summary, be prepared by having in mind what you would like turn-key and what you’d like to handle yourself. Research what may be required for your build and communicate wants and expectations with your builder. The more prepared you are up front financially, the less stressful and more enjoyable the build will be. That’s really the goal . . . to have a fun, exciting time building the home of your dreams!
Write something about yourself. No need to be fancy, just an overview.