All Topics / Help Needed! / Building Contract deposit

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  • Profile photo of tuggerwaughtuggerwaugh
    Participant
    @tuggerwaugh
    Join Date: 2007
    Post Count: 192
    June 13, 2009 - 2:09 am

    G'day All..

    Quick question… I am about to sign a contract for the building of my PPOR. Is the deposit price for the contract something the bank wil pay as part of my construction loan or is that an amount I will have to come up with myself? Any help appreciated? cheers
    tugger

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856
    June 13, 2009 - 10:20 am

    It depends upon how much of the construction cost you are borrowing. If you are borrowing 100% of the costruction costs then the deposit is part of the loan, if not you loan is for a lesser value. What it means for you is that you will start drawing down once you draw the deposit & there may be a restriction on the number of payments made by the bank or the bank may require some form of reciprocal assurance/security from the builder.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    June 13, 2009 - 11:55 am

    You will have to pay your share of the deal first before the bank will allow draw down of their funds.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

Viewing 3 posts - 1 through 3 (of 3 total)

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