Properly estimating the cost of building a cottage is extremely important and something I have not done very well. I found out that the land I purchased is even with the local water table so land fill must be brought in which will cost $10,000 I hadn’t anticipated.
For the most part I have been able to manage my expenses via my mortgage by extending the amortization period. Longer amortization periods mean lower monthly payments which makes it easier to meet the monthly financial burden. The benefit of lower monthly payments is that I am able to pay all my monthly bills on time, which directly affects my credit rating.
Maintaining a healthy credit rating ensures that I have negotiating power when going to a bank for Personal Loans. I have acquired a person line of credit which I use in times when I find I’m a little short, like paying property taxes. Unlike a mortgage a line of credit gives me the flexibility to access the money at any time as well as make payments far above the monthly required amount without any penalties or restrictions. In my case I will be using my personal loan to bring in the landfill and install the septic system.
If you are looking to build a cottage or just want to have access to money incase of an emergency speak with your banker about a personal loan.