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Paying the Bills
Financial Records and Checking For Builders
As soon as you have a commitment for a construction loan, set up a new business checking account, preferably with the same institution that is making the loan.
Use this account to pay any bill associated in any way with the building of your house. The bank will deposit construction loan funds into this account at your request, as the money becomes available.
It’s ok to put some of your own money into the account at first.
You will likely face some preliminary expenses prior to the closing of the loan.
It’s important to set up credit lines with material suppliers that you anticipate using.
Otherwise, you could be writing several checks per month to each, instead of writing one check to pay a monthly invoice.
If you don’t have a line of credit, some material suppliers will ask you to meet the delivery vehicle and write a check on the spot, which is even more inconvenient.
Setting up a credit line is really easy to do. Having a construction loan gives you good credit with necessary suppliers. It only takes five minutes to fill out a credit application.
You will at the least need accounts with:
- Full-service building supply company
- Ready-mix concrete supplier
- Brick / Block supplier
Many of the other materials that go into your house, such as roofing and wallboard, can be provided by the same building supply company that provides your lumber.
Don’t however, get locked into one company for buying everything just because it’s convenient.
They may not be the cheapest supplier available on things like roofing, wallboard, and trim materials. Consider this another reminder to shop around as much as possible.
Other materials, such as insulation, glass & mirror, and flooring, will be provided by the same company that provides installation labor, and you may not need to have an account with them if it’s one-time performance.
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