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Overview:
These types of loans are a money saving alternative to having a separate loan for
construction and then obtaining a regular mortgage when the home is complete. The savings
is due to only having one closing and one set of closing cost. Here is how it works...
Most of the processing of the loan is done the same way as any loan. The exception is the
appraisal, you will need to have have plans for the house you wish to build, and the lot
selected before the appraiser can determine the value of the proposed property. (You can
start processing you loan for approval before you have the final plans). If you already
own the land you can use the equity in the land as your down payment. If you do not own
the lot we will advance the money to purchase it at closing (less your down payment).
During the construction of the home we will advance the funds to build the house as it is
completed.
Is It For You?
If you wish to maintain control of the transaction by holding the purse strings
this is for you. One thing to remember is that you will bear the cost of the
interest during the construction of the home, so make sure that is in your budget.
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