The ABCs of Getting a Mortgage Loan for First-Timers

Posted on: 3 April 2017

It might be tempting to ignore your budget when designing and building your dream home, but that decision could come back to haunt you. Therefore, it is important to not only stick to the budget, but also look for ways to save on the overall project. To get you started, here are just a few ways you can cut costs.  

Be Realistic About Bids

Accepting bids on your new home construction instead of just hiring a builder is a smart move. It gives you a chance to compare estimated costs and possibly save on the expense of building your home. However, assessing bids can be tricky, and if you are not realistic about the process, you could end up with a builder who hands you a larger than expected bill when your home is finished.  

Although saving money is your goal, you should be wary of any bids that seem too low. If you receive a bid that is far lower than the others, take the time to read the details. There are a number of reasons that the bid could be lower, such as a small allowance for the bathroom, and you need to understand why before accepting the bid.  

Research Tax Credits

There are likely tax credits that you can claim on your next tax return that can help offset some of the cost of building a new home. For instance, if you install energy efficient windows, you could potentially take a credit for doing so.  

By researching the possible credits before construction starts on your home, you can possibly make modifications to your home's plan that could give you an advantage at tax time. The credits could mean thousands of dollars back into your pocket just for building your dream home.  

Review the Project With the Builder

It is not enough to tell the architect and builder what you want and then walk away. You need to ensure that everyone is on the same page. Exorbitant charges occur when there is confusion about the wishes of homeowner.  

Before construction starts, schedule a meeting with the builder and architect. Review the details of the construction line by line. If you are unsure about any aspect of the project, ask questions until you understand. During the meeting, you also need to discuss small details. Your builder might make assumptions about what you make that could be costly to you.  

Your real estate agent likely knows many other ways you can save on the construction of your new home. Talk to him or her about your budget and what you can do to stay within it.