Money Ran Out During My Self Build: Case Study

Graham Draycott’s plan to self build his first house was going splendidly until he lost his job and the finance halfway through the build.

With plans passed for his three bedroom home Graham Draycott was well on the way to achieving a lifelong ambition to build his own home. His wife Kelly was as keen as Graham to have a lovely home in the suburbs of London. With careful planning and an overdraft from the bank where Graham worked they were able to build the house steadily with the help of a small local building company. Graham and Kelly were hands on during the weekends when both were free from their demanding jobs.

Self Build Mortgage

“We had a mortgage whereby we were paid in stages after the build was inspected and certified by an accountant. Our small terraced house was paid for and we had decided to continue living in the house and use it as collateral. The house would be sold and the mortgage cleared upon completion,” said Graham. “We didn’t have much choice as there wasn’t enough space for a caravan on site and our parents don’t live in the area to be able to offer us a room during what we expected to be an eight month build.”

No Finance

“The problem started when due to the recession I lost my job with two week’s notice. This affected the overdraft that carried us between each stage payment on the self build mortgage. The redundancy payment and some back pay kept us building for another month but it was soon apparent that we would have a problem with money; there was not the chance of my finding a job as half the country seemed to be job hunting. Kelly was a secretary for a food company and her job was secure but her salary would not carry us through the remainder of the build. We were in real trouble,” he said.

Selling the Home

Kelly explained, “We put our house straight onto the market and reduced the price for a quick sale. It took three months and during that time we asked the builder to stop working as we would not have been able to meet his costs. He was really good about it and offered to carry on working one day each week and gave us three months credit. We were thankful but it was a worry as we are not the type of people to owe money. Graham was able to work with the builder and his assistant and in that time the shell of the house was built and the roof on. The money from the sale of the house came through and we faced another problem. We had nowhere to live and the new house was hardly fit to live in. Furthermore due to the old house being sold for a lower value we did not have the money to finish the new home.”

A Room at a Time

“It was late spring by that time and we should have had the house finished but it was still a building site. My dreams of having the garden front and back landscaped were forgotten completely. Graham and the builder managed to plaster and fit out the kitchen diner and the bathroom and after clearing the self build mortgage and paying off the builder we were broke. Luckily we realised that it was possible to live in the house as it was and so we slept and lived in the kitchen diner whilst Graham did as much as he could to the house whilst job hunting. I spent weekends tidying the garden so that it didn’t look like a building site and although we didn’t want to spend money on it at that point it was presentable. My birthday came around and the parents bought me a load of shingle which we used for the front drive. A lovely neighbour seeing our plight gave us plant cuttings which at least made the front of the house look nice.”

Completion

Graham added, “We had three bedrooms, an en suite and the living room to complete and it took a further year before we could honestly say the house was finished. We scrimped and scraped and with a couple of temporary jobs that I found we just about got by. It certainly wasn’t the plan to build our house this way but we still did it. I have found a job, not in the field I was used to but building our house has shown me that we can all try anything if we really try.”