Dangers of taking a Self Build UK Mortgage

What are the dangers of a self build mortgage?

There are so many risks with self-building. You are borrowing a massive amount of money that you will have to pay back however the building goes. The building is the most important part of the process, and if it goes wrong, then you are the one who bears the risks. Ultimately, your building will only be as good as the builder that you hire. So the way to solve the dangers of self-build mortgages is to make sure your builder is worth his salt.

Cowboy builders shouldn't be let anywhere near your home, but they can be difficult to spot, and once you have them working on building your home, it's difficult to stop them and its difficult to get back on track with the payments on your mortgage if you have thrown some down the drain. There are enough examples of unscrupulous builders that if you are not careful your roof will fly off the first time there is a strong breeze around your new home.

To avoid misunderstandings between you and the builders, you should take the most possible care when you choose and use a building contractor. To do this, make sure you take care of the following:

* Ask friends and neighbours if they can recommend anyone.
* Look at examples of the work of any contractors that have been recommended.
* Only use contractors that belong to a trade organization, as some of these will guarantee the workmanship quality and also that the task would be completed.
* Make sure your contractor isn't sub-letting all their work. You should obtain two or three quotations and negotiate with a contractor once you know his work and feel you can trust him completely.

You should understand here that legally, an estimate and a quotation are the same. This is important because many contractors view an estimate as only an approximation of the cost, and a quotation as an offer to do the agreed work at the quoted price. In fact they are the same.

When you get a quote, you should make sure it itemises all labour, materials and the job duration and include VAT. The quote should tell you if the price is firm or subject to additional charges.

You should agree on what might constitute an acceptable unforeseen extra, so you are prepared for what they might be.

You should agree on the payment method, and avoid paying before the work is started unless paying a small sum in advance secures you a good discount. Ideally, you should agree on staged payments, as the contractor will need cash flow as well, and may skimp on quality if this doesn't exist.

What are self build mortgages - CLICK HERE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

© AskFinancially.com 2009

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