Q. I own the land, asessed at $150,000. I have a upper 600 credit score, no debt and make $80,000 a year. I have around $50k in the bank. Will I qualify for a new home construction loan?
A. You should, but only 200k. You need to give them 25% down upfront, and with only 50k you are rather limited. You need to present them with your complete plans and general building permits as well, they will not give you a loan until you are ready to go. You have about 9 months to get it all done.
Where can i go online to see if i can prequalify instantly for a new home construction loan?
Q. I am wanting to build but i do not want to list my current farm for sale until i know that i qualify for a construction loan.
A. There is no "on line instant" approval process available to my knowledge. You can speak to a broker and give them the general details of your income, assets, and credit and they can give you a good idea. But any binding approval on a construction loan will take a full credit application, as well as cost to build estimates, plans for the build, applicable license to build, etc.
What if we do not sell our home by the time we have to close on our construction loan?
Q. What happens if we don't have the money from our existing home to pay into the construction loan? Will we have to keep the loan at that amount. Will we be able to put the money from our existing home into
the loan once we get it? Will we have to refinance the whole thing to do this and go through another closing? We would appreciate any answers that are based on facts only. Thanks.
the loan once we get it? Will we have to refinance the whole thing to do this and go through another closing? We would appreciate any answers that are based on facts only. Thanks.
A. I do know that I have heard of construction loans being extended even until the sale of the house.
How do construction loans work?
Q. My husband and I are working with a builder of a subdivision we are planning on building in. We chose a home from the options this builder has for the sub. To get started on the house, we need to give him $5,000 down. However we do not have the funds saved so we are able to do a construction loan. I've heard so many things about construction loans and how the fees are horrible. Yet, its been so hard for me to find any information. Would the fees be that steep, even though we only need $5000 down? Is there any specific banks/companies out there that make this process easier that anyone would recommend? Any help or information would be greatly appreciated. Thank You!
A. It doesn't sound like you are being required to get a construction loan. The builder is asking for an earnest money deposit. Typically, builders require $5,000 to start the home and would ask for an additional 5 or 10 during different phases of the project. If they are going to build something to your specifications, they want you to have enough money into it so you don't back out. The only financing you will need is a normal mortgage, once the house is complete. You will be able to use the money given to the builder as the down payment. Otherwise, you can buy the model.
Who is providing construction loans to build first home?
Q. I've been approved for a mortgage loan but need a construction loan to build a home.
In Texas. Great fica score 840 or higher. Have enough money in the bank. Have tried builder contact, waiting since month ago. A big lending company on-line bluntly told me that he didn't know of any bank that was offering construction loans because of the way things are with the economy right now?
In Texas. Great fica score 840 or higher. Have enough money in the bank. Have tried builder contact, waiting since month ago. A big lending company on-line bluntly told me that he didn't know of any bank that was offering construction loans because of the way things are with the economy right now?
A. what Col Kurtz didn't mention is that when you pay retail to a direct lender you end up with a higher rate and the lender gets more on the back end then a broker would, it's called SRP or service release premium.
Here's another little fact/difference.
The brokers yield spread premium has to be disclosed on the HUD1 settlement statement but the bank does not have to disclose their premium.
Here's another little fact/difference.
The brokers yield spread premium has to be disclosed on the HUD1 settlement statement but the bank does not have to disclose their premium.
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