Help!! New Build Mortgage

Benny22

Hi there,

Has anyone encountered problems getting their self build mortgage finalised before signing a contract with their building contractor?

Some more context....we’re anxious to get our house build started and recently agreed a fixed price contract with our building contractor (we have engaged an architect, QS etc). We haven’t signed the contract with our building contractor just yet, as we wanted to ensure we have the mortgage finalised with our bank!
The problem is, our bank is adamant they want to see the signed contract before they can issue our mortgage offer (we’ve already mortgage approval in principle). Our concern is that if we sign the contract but don’t get the mortgage, we could be held to the legal contract with our building contractor. We’ve already sent the bank the detailed build costing which was signed by our architect. Any advice on this would be much appreciated.

TPF2012

Is a Costings signed off by your Architect not fulfill the Banks requirement. That done us for our self build mortgage, no contractor.

Benny22

TPF2012 wrote: »

Is a Costings signed off by your Architect not fulfill the Banks requirement. That done us for our self build mortgage, no contractor.

No, there is a line in the costings template (AIB) where if you are going with a Fixed Price Contract (versus direct Labour) you need to attach a copy of the signed contract. This doesn’t make sense to us as you would be signing a contract before having the funds confirmed! Bit of a chicken-egg scenario...we don’t know what to do...I’m assuming we’re not the first to encounter this...just wondering what others have done...

TPF2012

Could you not say your going direct labour even if you are going to get a contractor? Just a costings sheet from arch will do then. We told the arch what are finances were and he did the costings accordingly. Well for Ulster anyway.