The Lowdown on Construction Loans
Sometimes the only way to get your dream home is to build it. Wondering where to start? We’ve got your back. Here’s the lowdown:
We recommend you start with a loan officer, however if you’ve already begun your journey with a REALTOR® we’re happy to get you on track with financing!
Step 1: Find a loan officer and ask about Construction to Perm options.
- You may have heard a Construction to Perm loan referred to as a single close, one-time close, construction conversion, CTP, or something else along those lines. Essentially this loan type allows you to close on both your construction and permanent financing, eliminating the need for multiple loans.
- Your LO (loan officer) can help answer any questions or address any concerns you may have. During this step it’s important to get prequalified so you know just how much you can spend, especially as you get to work with a builder.
Step 2: Land your lot & your real estate agent
- Now is the time to find the right place to build and the right person to help you find it. Your real estate agent will play a key role in helping you find the perfect piece of land.
- Double check that the land is “perc’d” so you can build on it.
Step 3: Select a builder
- Do your research and find a builder whose experience, style and reputation best fits your needs and vision.
Step 4: The contract
- Once you find the layout you love, the builder will work up a sales contract. You may also put a deposit down.
Step 5: The loan process
- Work with your lender to provide them with the requested docs to keep your loan moving to Underwriting.
Step 6: Final touches
- Finalize building plans with your builder, as well as loan plans with your lender.
Step 7: Closing
- Sign the paperwork - your home is underway!
Step 8: Construction
- Keep in close contact with your builder during this phase. It’s important to be involved with your builder throughout the entire process.
- When nearing completion, be sure to review all of your build requests to ensure they have been fulfilled.
Step 9: Loan modification and closing
- Within 30 days of home completion, we’ll do a quick loan modification to make it a permanent loan.
- After your paperwork is signed, you’ll receive the keys to your new home!
Step 10: Moving day
- The build journey ends here, it’s time to move into your beautiful new home and start a new life journey!
Want some more in-depth information about any of the steps above? Reach out to one of our qualified LOs by clicking here.
