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What kinds of loans do you offer?
We offer short-term construction loans for conventional
framed homes, log homes, timber frame homes, kit homes, modular*
homes and dome homes. You can build a home for your own use or you
can build a rental property. You can hire a contractor or you can
act as your own contractor.
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Do I have to use my money before I can get a construction
draw?
No. When you order a draw check you will call, email, mail,
fax or log into our online borrower portal to make your draw request.
We will then mail you a check made payable to you. You will deposit
the check into your personal checking account and pay your contractors
and suppliers.
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How many times can I ask for a draw?
As many as you like. There is no limit and there are no
draw fees.
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Are inspections required for every draw?
No. During the loan, the construction will be inspected at the completion
of every three line items on the budget or as each 10% increment
of the loan payout is reached, whichever comes first. The cost of
each inspection averages $105.00 and is paid out of the loan.
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In the event of cost over-runs, can I get an increase?
Initially, an allowance for cost over-runs is built into
the loan but if an increase is still needed we can increase the
loan providing you qualify for the amount.
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How long is the loan?
The maximum term of the loan is 18 months and there is
no prepayment penalty.
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Can the loan start construction and I finish it later with
my own funds?
No. The construction loan must complete construction. Any
money you intend to use towards construction must be used prior
to the construction loan.
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Can the loan finish construction that has already been started?
Yes.
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What are your interest rates?
Our lowest rate is Prime plus 1 and the highest rate is
Prime plus 5. All Interest rates are adjustable.
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Is this an interest only loan?
Yes. Every month you pay interest only on the amount that you have
drawn from the loan. Taxes and insurance are paid directly by you.
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How much of a down payment do I need to qualify?
In most cases, the minimum equity into the project needed
prior to funding is equal to 35% of the total cost of the project
(land cost plus construction cost.) Any money you have already paid
toward the land and/or construction can and will be applied to the
down payment (equity) requirement.
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Can the cost of the land be paid from the loan?
In most cases, as long as the amount of equity you have in the project
is equal to 35% of the total cost of the project (land cost plus
construction cost), then the loan can pay off the balance of the
land.
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What is your loan to value percentage?
The highest is 65%.
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What is the lowest and highest loan amount?
The lowest is $50,000.00 and the highest is $415,000.00.
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Do I need to be pre-qualified for a permanent loan prior
to the construction loan? Yes.
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Can I hire a contractor?
You can hire a contractor or you can act as your own contractor.
If you act as your own contractor, we do not require you to have
a site or project supervisor.
If you have any other questions please call us at 800-543-5600.
Many of our customers are building a house for the first time, so
we are very familiar with your concerns and needs.
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