What are the problems in submitting bills while availing home loan on own construction?

I want to avail home loan from bank to construct home on my plot. I want to construct the home by using labour contract and providing materials. Bank ask to submit the bills for availing loan in installments. What are the problems faced during submission of bills? I don’t have any experience in construction field?

2 Replies to “What are the problems in submitting bills while availing home loan on own construction?”

  1. We didn’t have any problems submitting them.. it was very easy going the whole way. The only time I have heard of anyone having problems with a construction loan is if you are not done building within the designated time. I would presume that each lender is different though, and maybe we just got lucky?

  2. hello NS

    absolutely no problem. you are saving in getting executed your house construction through labour contract by supplying material. good choice if you are free to run for purchase of required materials.

    the instalments are released generally by stages of the building like foundation, lintel level, roof, flooring and completion.

    you have to give a letter to the funding bank that the particular stage reached and payment required. banks authorised valuer will inspect and send a certificate to the bank recommending the quantum of amount that can be released for the stage. subsequently you will get the check.

    so you need not prepare the bill. you need to write the stage only. it is simple.

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