Building homes in Phoenix, Arizona is a very different process than purchasing a home already constructed. When you buy a finished home, even if it’s a home under construction by a developer, you don’t have to worry about special financing. But managing your own construction is a little different.
There are some fabulous lots available for homes in Phoenix, Arizona. For homeowners that want to build a custom home, the mountains and desert vistas offer an amazing backdrop for a custom, luxury home. But custom homes require a little advanced financial planning.
Building a home requires slightly different financing. Most people finance their building process with a construction loan. These loans have milestones that must be met before some of the funds are available. Usually, these funds are kept by the lender until each step of the building process is completed.
While building a custom home is one of the most exciting steps in home ownership, it requires advanced planning. Most of the planning concerns how you are going to meet the financial expenses needed to complete the home. When you are building your custom home, there are different expenses to consider.
* You may need money for a down payment on the land and you need funds for the closing costs of the loan.
* You may need money for loan payments and taxes.
* You may need funds for an architect, for the house plans, for permits and licenses.
* You may need to continue to pay your mortgage payments or rent and homeowner’s fees.
* You may need additional funds for material upgrades. All too often you’ll find better flooring, appliances, or unique kitchen cabinets – all of which require cash up front to place into your new home.
* You will need to plan for project cost overruns. Even the most thorough home budget won’t eliminate project overruns. You should plan for your project to be at least 10% to 25% over budget, at a minimum.
It’s possible to build your dream home, especially when it’s in a remarkable environment like Phoenix, Arizona. But it does require a little planning and probably a little savings or money in the bank. Once you’ve finished planning and begin the construction process, you’ll have a home that is just as unique as you and your family. Imagine how you’ll feel when your house is done. All that planning and saving will pay off when you are living in your dream home in Phoenix, Arizona.
Gary Ogami has over 13 years experience working in the financial services industry. He has worked with hundreds of individuals and families to find mortgage options that work for them.
He prides himself on making the mortgage process as easy as possible for his clients and is very passionate about helping them save money and develop a strong financial foundation.