Construction Loan Questions?

A SPEC construction loan is an interim construction loan only, and not the permanent financing because the exit strategy is to sell the property.  “SPEC” here is short for “speculating”, because the builder or investor is speculating that they can sell the property at a profit.   For this reason, the builder or investor is […]

This is a bad idea for many reasons, but sometimes borrowers must start due to the permit process.  If this is the case, and you have to start grading, and maybe have to do the foundation, we would suggest a separate contract with the builder.  Contact a local office of First American, Fidelity or another

Assuming there is no question of occupancy on the new home to be constructed, if you earn enough income to cover the PITI (principle, interest, taxes and insurance) on both homes, the answer is no.  Even if you can’t cover both payments with debt ratios that meet program guidelines, you may still qualify.  Before the

The short answer is yes, you can get a construction loan to build a log home.  We’ve done them.  The problem is that the property has to be appraised, and it must be demonstrated that log home construction is common for the area.  Unfortunately, the way that is demonstrated is with typically with at least

There are two main elements of qualifying for a construction loan, the property and the borrowers themselves.  In regard to the property, it should be an owner occupied single family residence (some programs allow owner occupied duplexes), or a second home.  It should be clear from the circumstances that the borrowers intend to occupy the

A single close construction loan, also known as a one time close construction loan, provides construction funding and is also the permanent financing.  This is in contrast to a more traditional interim construction loan which would require “take out” permanent financing to pay it off.  Single close construction loans have two basic structures.  Our construction