billyjames
New member
My wife and I are FHBs and require a construction loan as we brought house and land separately and are building while we rent.
Being completely in over our heads we trusted our broker. He gave us options for banks and his recommendation - Bank of Adelaide - who we went with.
Now the stuff up was the broker told us this loan would be interest only while we built but it is in fact P&I, which is completely unsustainable. He spoke to the bank and said best they can do is lower the interest rate by 0.05% but we will have to continue to pay P&I. The first payment came out Friday.
I guess I am after advice from people who know what they are doing, because I’m certainly in over my head and have lost faith in my broker as he hasn’t admitted fault and once we signed the mortgage he became very unresponsive.
Edit: for all those on their high horses - the contract said stated P&I so we questioned the broker, he said that’s what our rate will be once construction is finalised and we would only be paying interest during the build.
Update: Spoke with my broker, they apologised and said they shouldve been more vigilant when checking as he did apply for an I/O construction loan so I guess the Bank messed up? Either way we are going to do an internal refinance with the same bank onto a I/O contruction loan (which has a slightly better rate 6.03% vs 6.09%).
For those that offered genuine advice, thank you.
Being completely in over our heads we trusted our broker. He gave us options for banks and his recommendation - Bank of Adelaide - who we went with.
Now the stuff up was the broker told us this loan would be interest only while we built but it is in fact P&I, which is completely unsustainable. He spoke to the bank and said best they can do is lower the interest rate by 0.05% but we will have to continue to pay P&I. The first payment came out Friday.
I guess I am after advice from people who know what they are doing, because I’m certainly in over my head and have lost faith in my broker as he hasn’t admitted fault and once we signed the mortgage he became very unresponsive.
Edit: for all those on their high horses - the contract said stated P&I so we questioned the broker, he said that’s what our rate will be once construction is finalised and we would only be paying interest during the build.
Update: Spoke with my broker, they apologised and said they shouldve been more vigilant when checking as he did apply for an I/O construction loan so I guess the Bank messed up? Either way we are going to do an internal refinance with the same bank onto a I/O contruction loan (which has a slightly better rate 6.03% vs 6.09%).
For those that offered genuine advice, thank you.