Things to consider
Lenders change their policies and requirements for their products. In this economy there are many more restrictions being placed on borrowers.
Always ensure that you are able to obtain the new funds before selling your current home. This is part of a free mortgage health check.
A relocation loan allows you to purchase your next property before you have sold your existing property.
A relocation loan generally gives you around six months to sell your existing property. There are numerous other benefits to a relocation loan.
The lender requires you to have sufficient equity in your existing mortgage to support this process.
A construction loan allows you to secure the mortgage based off an “on completion” value. For this to happen the lender requires you to use a licensed builder with a fixed price tender. That tender is then used by the lenders valuers.
A significant advantage is that you only pay interest on what the lender has paid to the builder.
Keeping your house
- What will the existing home be used for? Typically it will be rented out and used as an investment property.
- Can you afford to have both properties? This ties into the above with rent being a big help. There are many factors that affect how much you can borrow.
- How will the timings work out? When will you be looking, purchasing, moving and perhaps renting? This is planned for in the free mortgage health check.