My goal for all of us (myself included) is to pay off that home loan – I mean once you’ve done that you can go on more holidays, help the kids, choose your hours at work (buy more property!)…
And today I spoke to a day who has done just this – owns her home outright – hooray!!! – which she is selling, and is buying new land and building a new home more suited to her current family.
Her question was how to pay the builder if you have cash, and it;s the same where you’re paying all in cash or only have a small loan.
My response to her: In regards paying for the build with cash, this isn’t an issue.
The builder may ask you to put your cash into separate term deposit or other account (I’ve heard of joint accounts with the builder but not sure I’m comfortable with that!) so its quarantined and you are sure of having the money to pay each stage. They’ll want to see a statement before they start but otherwise its very straight forward and you pay in stages much like you would with a lender involved..
In regards this, one of the things the bank does during construction is random inspections / valuations to make sure the work is done – you might consider engaging a building inspector to do the same to you, with the advantage of them being specialised in picking up the minor faults that may slip past the builder.
This is actually a great idea for anyone who’s building and they’re not very expensive, and deliver a whole heap of peace of mind.