One-Time Close

• Eligible loan options:  30/20/15 year fixed
• 3/1 & 5/1 ARMS
• Primary Residences and 2nd Homes
• Possibly up to 100% financing.  Better rates and cost if 5% down.
• Lock in an interest rate for up to 360 days!
• No up front fees for Floatdown rate option.  If you choose to floatdown rate if rates are lower once home is complete, then it costs $250.
• We can offset buyers current home payment with fair market value of rental.
• Only One appraisal needed.
• Interest only payments on amount disbursed during construction.
• NO  taxes, insurance or MI payments due during construction.
• Easy Builder Approval – 1 page form.
• No credit report needed on builder.
• If builder is already approved, then don’t need to re-qualify.
• Local Inspections to expedite draw payments to builder.
• Demolition cost can be included in cost to construct.
• Purchase re-habs and refinance re-habs treated the same as new construction.

2-Time Close Program

First Close:

• First get loan for construction from local bank.
• Rates usually prime + 1-2% paying interest only on amount drawn.
• Have to provide full income and asset information to banks with possible down payments.
• Close on construction loan after underwriting complete – all before any construction begins.
• Closing costs required at time of construction loan closing to include Title work, appraisals, surveys, underwriting, and origination fees from bank.
• Eligible loan periods:  adjustable based on prime.  Loan to be paid in complete after 6, 9 or 12 months of construction time.
• Once construction is complete, must get mortgage to pay of this loan. 

Second Close:   Must re-apply for entire new loan

• Go through loan approval all over again with help of broker.
• Re-evaluate credit of borrower.  If credit has gone down, can hurt rate and options at time new mortgage.
• Similar to a refinance, but have to get new appraisal, updated survey and pay closing costs again.  (this doesn’t double costs, but involves more)
• Lock in an interest rate at this time.  Therefore if rates have gone up during construction time, you pay higher rates.
• Close final loan and finally have mortgage complete.