Construction Loan Questions?

Can we start construction, and then get a construction loan later?

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 …

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Do we have to sell our current home to qualify for a construction loan?

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 …

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How do we qualify for a construction loan?

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 …

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What is a single close construction loan?

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 …

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