Drop down to see post by Lina, she is right on the mark. I would add a few things. Building a home is a process, I've built over 250 of them. If you do not have the background in construction you will need help. This must begin with financing. Will a bank make a construction loan directly to you? Some banks are not excited about loaning money to a novice in building. If they will loan to you then there are some options:
1. Hire a General contractor as a consultant for a flat fee. They know the process, bow to obtain bids and how to negotiate the contracts. Here is the most important part of the process, level the playing field;
2. Outline the specifications of the project right down to allowances for lighting and carpet. Know the trim type, doors, hardward and fixtures. Where the novice will get pinched is on bids that do not have equal components in them. At the end of the day, the lowest bid may include junk components.
3. Speak to wholesale building suppliers, they know the builders and the subcontractors and can make a recommendation on both General contractors and subs.
4. A General contractor as a consultant will know what is sub standard work by the subcontractors in concrete, framing, insulation, roofing, sheetrock and texture and finish. Knowing the proper place for outlets and switches comes from experience.
If a bank will not loan you the money directly, you are back to hiring a qualified builder. Remember that the more expernsive may not always translate into better quality.
Good advice would be to get out and see the work of 4-5 trim carpenters and find 2 you like. You are looking for tight corners (no gaps) and doors that hang square (dtay in place when pushed open) and have the same reveal. When you find a trim carpenter you like, ask them who they like to trim in after. A trim carpenter has to fix all of the mistakes from lousy framers and bad sheetrockers. They much prefer to come in after framers that frame square with even floors.The trim carpenter will have some strong opinions who they like to follow and who makes theirs jobs a night mare. The framer can recommend foundation contractors who pour square and flat foundations, again it makes their job easier.
If you plan to build the same ole house that can be found all over town, buy existing. If you have a special design or needs, or it just doesn't exist then building is a good idea. I built a home for my own family, even when it did not appear to make sense in this market because we wanted 4 master bedrooms and a dedicated laundry room for the senior master suite. This is something that simply does not exist in my town. Costs are higher when you build for yourself because you will not put junk in your own house but you will get what you want that way.... more
Wells Fargo requires 10% down with a 560 score, but it is tough to get approved even with the down payment. What is on your fiance's credit will be just as important as the score itself. He'll need at least 12 months of clean credit. Have you reviewed his credit? Have you taken any steps to improve his scores/work on his credit?... more
Sorry didn't realize you were a mortgage broker. I guess you were asking on behalf of a client.
Speak to your underwriter or to the underwriter of the bank you are brokering with, but those are the FHA guidelines for a foreclosure.... more