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Union Home Mortgage Review – Construction Loans Explained [4 Massive Mistakes]


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Today I’m going to show you how to avoid the BIG mistakes made with construction home loans. In fact, these are the same tips I’ve used to help my customers go from being declined to approved.

00:00 Construction Loans Explained [4 Massive Mistakes] 00:56 1. Do it all at once
02:48 2. Recent Sales
04:28 3. The Numbers
05:07 4. Variations

I’m Josh Vecchio, mortgage broker with Hunter Galloway. And in this video I’m going to walk you through my 4 ways to avoid BIG construction loan mistakes, step by step, so keep watching!!

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Find Jayden here:

T: 1300 088 065

Mortgage Broker Brisbane – Hunter Galloway
Head Office: 3 Latrobe Tce Paddington QLD 4064
PO Box 841, Paddington QLD 4064
CBD Office: Level 20, 300 Queen Street Brisbane, QLD 4000

Hunter Galloway are an Award Winning Mortgage Broker based in Brisbane. We help clients from our local area, Australia, and all over the world. We believe buying a home should be stress-free and uncomplicated, and we will work for you to make your dreams become reality.

Next steps and settling your first home

Our team here at Hunter Galloway is here to help you buy a home in Brisbane. Nathan & Joshua Vecchio are Senior Mortgage brokers who specialise in making your home journey easy.

Unlike other mortgage brokers who are just one person operators, we have an entire team of experts to help make your home loan journey as simple as possible.

If you want to get started, please get in touch and we can book a time that suits you – either a phone call information session or a face to face meeting (which doesn’t cost anything for you).

Last year we saw a troubling trend, construction loan after construction loan, declined. It had nothing to do with our customers financial positions and everything to do with the banks valuers. You see, they had changed their methodology without telling anyone. Never before had we seen so many low valuations. It was by taking the lessons learned through trial and error that we’ve since cracked the code, and by using these same techniques you too will be able to avoid making BIG mistakes. So let’s jump in.

1 – Do it all at once

Having made the decision to build a new home the first thing you’ll want to avoid doing is rushing. This is a big mistake. Remember fast is slow and as counter intuitive this is, slow down, take your time and don’t be pressured.

When buying land, there’s always demand to settle as quickly as you can. In Queensland generally sellers want this done in either 30 days from the contract date or 14 days from registration.

So the first thing you’re going to do is change this! Have both finance and settlement terms in line up with construction. This means rather than owning your land first and months later getting applying for construction loan approval. You’ll have the ability to get approval for both land and construction loan.

This is hard as will need time to allow your builder to prepare the fixed price building contract, plans and specifications.

2 – Recent sales

If you’re in a new estate the bank’s valuers will have trouble valuing your property. The valuation report is known as an as if complete valuation. That is to say, when the property is completed, in that market, what will it be worth. Now you see if its a new development, there may not be any properties in the area that can be completed, as they’ll look at the past 6 months history.

How to avoid this is to offer the valuer sales history from the suburb over, thus giving the valuer context and for something to work with. It’s best to do this upfront as once the report is produced the horse has bolted.

3 – Beds, bath, car

The bank’s valuers when valuing the property will look at data to complete their valuation. The primary data they use to confirm the value of your property is the number of bedrooms, bathrooms, car spaces, floor area and size of your block. So an easy tip to help increase the value of your yet to be built home is to increase these numbers. So for example, if you’re looking to have a study in your home, rather than build a study, invest a little more and build a bedroom (with the main difference in it either having a wardrobe or not). Not only will this help come valuation but also when you sell.

4 – Variations
A common problem is that people rush to get their plans into the bank. Only to change the plans of the house again take it slow and look to get every detail sorted before getting the approval. As in most cases once the banks approved your loan any changes to the contract will result in you footing the bill rather than bank.

Thanks for watching the Union Home Mortgage Review video!

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  1. Mortgage Broker Brisbane - Hunter Galloway
    July 25, 2021 at 3:28 pm

    Join FB Group (Free Access) 👉

  2. Patrick Repsher
    July 25, 2021 at 3:28 pm

    I’m in America so perhaps things are a bit different however THANK you Joshua for taking the time to make this informing video it is certainly appreciated, Best of luck!


  3. Anna Joan
    July 25, 2021 at 3:28 pm

    Mrs Jane is legit and her method works like magic I keep on earning every single week with her new strategy,,

  4. caleb tofinga
    July 25, 2021 at 3:28 pm

    When can i apply for a regional and first home grant ? Once the contract of the build has been signed as well as land

  5. Antony Harris
    July 25, 2021 at 3:28 pm

    You haven’t mentioned that buying vacant land and then developing a DA upon it will raise its value – which creates uplift in the equity and therefore enables you to refinance at a lower LVI and releasing cash to put towards your build. Doing the finance all at once is not necessarily the best way to finance your build phase!

  6. Atlantia Sea
    July 25, 2021 at 3:28 pm

    Thank you sweetheart! 🙂

  7. queencess26
    July 25, 2021 at 3:28 pm

    Can you guys touch upon discount building variations? My builder is reducing our house price by 24k but wants such to pay it back with the grant that we're getting from the government. Does this sound dodgy?

  8. Alex C
    July 25, 2021 at 3:28 pm

    during construction, are you able to change certain things, minor layouts and possibly adding an extra bathroom ect if you already have the finance for these changes, or would you need to inform the bank of this as well?

  9. Manpreet Singh
    July 25, 2021 at 3:28 pm

    Does it matter if the study room which is supposed to be turned into a bedroom has a door or not? Most study rooms don't have doors. This is given that one builds a robe in the study.

  10. Mortgage Broker Brisbane - Hunter Galloway
    July 25, 2021 at 3:28 pm

    Join our live upcoming Home Buying Masterclass [webinar]. It's completely free!