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Mortgage for a house on new estate

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  • 05-06-2012 8:56pm
    #1
    Jammie01
    Registered Users Posts: 55 ✭✭


    Does anyone know if you are buying a new house and it hasn't been built yet, when would your mortgage repayments start? I'm considering buying on a new development in the next couple of months and would need to pay a booking deposit and provide proof of mortgage approval. The thing is the house wouldn't actually be built for approx 10-12 months so my mortgage approval could change or expire? Or would I be paying a mortgage from the moment the contracts are signed and have to pay rent and mortgage at same time while I wait for it to be built?


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    #2
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Normally mortgage repayments commence once you draw down the mortgage. Individual cases will differ in their details- you'd really be best asking your mortgage advisor for details on when payments commence- and most of us here will only be guessing.


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    #3
    the_syco
    Registered Users Posts: 37,299 ✭✭✭✭the_syco


    Jammie01 wrote: »
    Or would I be paying a mortgage from the moment the contracts are signed and have to pay rent and mortgage at same time while I wait for it to be built?
    MAKE SURE YOU HAVE A CLAUSE that says if house isn't built by X time you get your money back. Talk to a solicitor about it. Otherwise, should builder go bust, builder take their time, builder not finish it, etc, you'll still be paying the mortgage.


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    #4
    Liam D Ferguson
    Registered Users Posts: 542 ✭✭✭Liam D Ferguson


    You'll only get the mortgage cheque once the house is fully completed and ready to move in. So you don't start paying your mortgage until then.

    Be very careful about this. Mortgage approval typically is valid for about 3 - 6 months, depending on the lender. So you can get approval now in order to sign contracts to buy this place. But your mortgage approval may well have expired by the time the house is complete. So you'll need to re-apply then. This raises the possibility that you might not be approved then. So I'd make sure that your solicitor leaves you a get-out clause in the contract to protect you against this eventuality.


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    #5
    Jammie01
    Registered Users Posts: 55 ✭✭Jammie01


    Thanks all, it's a tough one! Think I'm going to sit tight and leave it for another while and see how the building on the estate is going. Seems like too much of a risk at the moment. Will bear all this advice in mind if I decide to go down this road in the future.


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    #6
    engineermike
    Users Awaiting Email Confirmation Posts: 280 ✭✭engineermike


    Jammie01 wrote: »
    Thanks all, it's a tough one! Think I'm going to sit tight and leave it for another while and see how the building on the estate is going. Seems like too much of a risk at the moment. Will bear all this advice in mind if I decide to go down this road in the future.

    I'd sit tight - a lot can happen in Ireland in 10 -12 months. If you really want the property / location - check periodically on whats sold ( usually very little moves between end of this month and start of August ).
    Above all - even when you do commit - ensure Its under the guidance of your solicitor and mortgage provider.
    Regards,
    Mike f


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