Buying a house that isn't built yet?

nemoisback66

Hi All,

As the title says I am just looking to find out a bit of info from anyone who has had any experience of buying a house that is yet to be built.

The house is expected to be finished around August but the estate agent said that it could be Spring 2016 before it is finished.

The only problem with this is, that there is a deposit to be paid and with most mortgage lenders only giving approval of 3 - 6 months approval if it does go into Spring 2016 before the house is completed I would have to get re-approval.

I am just worried if circumstances change is there anyway that you can get the deposit back if re-approval wasn't granted?

Is there any other things that I should consider before putting down a deposit?

trobbin

You're worried about circumstances changing during the time of the build, because it could result in you loosing your deposit. Yet you aren't worried about talking on a mortgage for probably 25/30years? Because in that timeframe you're guaranteed major life changes.

To answer your main question. Yes there's many things you should consider before paying a deposit, and the main thing is to make up your mind.

Just curious, but how old are you?

nemoisback66

trobbin wrote: »

You're worried about circumstances changing during the time of the build, because it could result in you loosing your deposit. Yet you aren't worried about talking on a mortgage for probably 25/30years? Because in that timeframe you're guaranteed major life changes.

To answer your main question. Yes there's many things you should consider before paying a deposit, and the main thing is to make up your mind.

Just curious, but how old are you?

I have considered the long term and know that there are plenty of circumstances that can change over 25/30 years. I was just curious in the short term if the deposit was paid and the completion of the house would be over the 6 months if I wasn't to get re approved would there be a clause that would entitle me to get the deposit back if something did happen?

I'm 30 by the way.

trobbin

I would recommend you speak to your solicitor about that. But yes, you should get your deposit, if loan approval isn't approved.

Dearg81

trobbin wrote: »

I would recommend you speak to your solicitor about that. But yes, you should get your deposit, if loan approval isn't approved.

Yea you need to get your solicitor to add a cluase about getting your deposit back if you cannot get mortgage approval. I'm in the same boat at the moment and my house is also due to be finished in August too.

nemoisback66

Dearg81 wrote: »

Yea you need to get your solicitor to add a cluase about getting your deposit back if you cannot get mortgage approval. I'm in the same boat at the moment and my house is also due to be finished in August too.

I will be speaking to them this week and will also be taking to the banks about the mortgage approval. Fingers crossed. And best of luck to you.

the_syco

nemoisback66 wrote: »

The house is expected to be finished around August but the estate agent said that it could be Spring 2016 before it is finished.

That's a fairly substantial gap. Perhaps talk to your solicitor about putting in a clause that if the house isn't built by X date, you get your deposit back.

Look at who the builders are, and if they have unsuccessfully completed any other estates before going bust, under a different company name.

Although there are builders who have ridden out the storm, be careful.

joey100

I'm in a similar situation. Deposit put down last August, house meant to be built by Christmas and only done now.

We had 6 months of being approved in principle, that got us up to Christmas after this we applied for full sanction and once we received that we had another 6 months to close before having to re-apply. That's all with AIB so I'm not sure with other banks but I'd check it out and see.

jester77

Maybe it is different in Ireland, but I was in the same situation. We got a date where they said they should be finished, got the mortgage which would start around the time the house was due to be finished and we had a contract with the building company that would cover any costs that would arise if they went past the due date. This is important. It would have covered rent and bills for each month they were over the due date. Our house was done in time so it wasn't needed but one of the neighbouring houses had their basement flooded and were not able to move in for a few months and they were covered by this. Make sure and look for something similar before signing any contract so that you are covered.