Looking to build your dream home? A one-time close, or construction-to-permanent, option may combine the construction cost, price of the lot and final mortgage into a single loan, all with only a single closing, eliminating the need to re-run credit or verify income and employment for a second time.

Basic Qualifications

  • 5% Down for conforming Primary Residence for up to 4 units
  • 700 Credit Score
  • Investment Properties and Second Home options
  • Interested Party Contributions allowed
  • Reserves only required on some loans
  • Non-Occupant Co-Borrowers allowed in some instances
  • Up to 50% DTI

ROADMAP FOR A SINGLE CLOSE CONSTRUCTION LOAN

  1. Future Dream Homeowner decides to build a house
  2. Borrower contacts a Melanie for available financing options
  3. Melanie will connect the Borrower with a trusted local Realtor if they do not have one to search for land (*note if the borrower already owns land, we will skip this step)
  4. Borrower finds and provides Melanie with a local contactor to build their dream home
  5. Granite will assess the contractor to ensure they meet qualifications. This process takes 3 business days
  6. Melanie will assist the Borrower with finishing the loan application.
  7. Fairway Underwriting will issue a loan decision
  8. Fairway Underwriting will issue loan terms, interest rate, loan amount, and acceptance of the contractor and proposed construction project and budget.
  9. Once loan is approved, loan moves along following standard closing procedures. Title is ordered, loan is closed, and the initial draw will be initiated by Granite.
  10. Granite will manage all fund disbursements, mechanic’s lien waivers, title documentation review, and all required inspections for construction.
  11. Granite will continuously ensure that all contractor licenses are valid, insurance policies are in good standing, construction continues to be within budget, and the timeline of completion remains on target.
  12. At completion, the contractor will provide a certificate of completion, which serves as proof that the project is finished and meets the conditions of the local government agency and the loan agreement. Final inspections are ordered. Borrowers have the option to request a float down if market rate has improved.
  13. Once inspections are complete, Fairway will issue the borrowers final loan documents to be signed. 
  14. The finalized loan documents will authorize the final draw to the contractor for any outstanding funds due and convert the title policy into a “Final” status ensuring the property is free from any liens or encumbrances.
  15. The process is now completed.

Reach out to Melanie at The French Team for more information today!

Posted in blog and tagged , , , , , ,