Similarly, DIY build your own home kits enable you to assemble your dream home. With an instruction manual and booklet, you can arrange and assemble materials based on your blueprint. Prefabricated houses and DIY home kits are less expensive than commercialized houses. You neither need numerous workers nor costly housing contracts. You can divide costs with different subcontractors who offer cheap supplies and construction materials. Hence, you can save a lot of money for construction equipment, materials, and labor.

Honestly fill in the data concerning the style and quality of home you want to build. Means will explain how to determine the quality. Then add to the base home any additions, such as a deck an extra bathroom and/or a driveway. Then use the "location factor" for your area. [A home will cost more to build in San Francisco, California than Atlanta, Georgia] You will be amazed at how close this estimated cost to build your home will be to the actual cost.

b. The Projected Construction Cost (Material, Labor, Subcontractors and Overhead)

Therefore, for example purposes, let's assume the following: you are able to borrow $194,504.00 (based on your projected monthly mortgage amount), less lender fees of $16,046.00 and cost additions of $41,378.00, you will actually have $137,080.00 from which to calculate the final square footage that you can build. Based on $67.24 per square foot, you will be able to build a 2,038 square foot home.

· - Closing costs on the permanent loan [normally 4% of the loan amount]

a. Lender fees

For those of you who have 30 cookbooks on "how to build a home," I know the frustration you feel. All of the recipes look easy but none are complete enough to get you started with the meal. And for those of you who want to first learn everything there is to know about each ingredient, for example, how olive oil is made, what makes one olive better than another olive, what process produces the best olive oil, how the olives are sent to market and sold, etc., "go for it." But I must tell you, you will never live long enough to learn everything there is to know about every ingredient, and you will, therefore, never cook the first meal (or build the first home) if you get caught in this trap. You don't need to know everything about each ingredient to build a quality home, simply follow the winning recipes and "everything will be just fine."

You need to acquire this number by contacting a mortgage broker in your area or over the Internet. If you do not know a mortgage broker in your area, ask your current banker whom they recommend for a permanent loan. More than likely, your bank will have a mortgage department and they'll want your business.

The topic of preparing to build your own home is continued in Part 4.

Lender fees normally include:

Balance = $137,080.00

4. What Size Home Can You Afford?