|
| Which loan is right for me? |
Years
in
the house |
Recommended
Program |
| 1 - 3 |
3/1 ARM, 1year ARM or
6 month ARM |
| 3 - 5 |
5/1 ARM |
| 5 - 7 |
7/1 ARM |
| 7 - 10 |
10/1 ARM, 30 year fixed or
15 year fixed |
|
|
|
The Ins and Outs of a Construction Loan 
January 20, 2010
Deciding to build your own home is just the beginning of a huge project. It is exciting in the beginning but it can become a mess if you don\'t know all the ins and outs of getting a construction loan. The first step to getting a construction loan, is to fill out a construction loans application. This application is the same as a home loan application in some ways and it is very different in others. Most loan applications want to know your income and your credit score. You also need these things for a construction loan but you also need a lot more.
Before you fill out a construction loans application you want to make sure that you have your building plans available. Once you choose your plans you have to have these plans approved. You also want to do a break down of what each phase of the project is going to cost. You also need to know what building permits you are going to need during the process and also the cost of these permits. Proof of income is a huge factor in acquiring a construction loan. They will accept stated income in some cases but they may also ask for two years of tax returns.
For any home loan, you need to know the exact debt that you owe. If you owe a lot money to creditors, they may not approve your loan. They also want to know why who you\'re building the home for. Is it an investment property, a second home, a primary residence or are you just going to sell it? These factors determine the type of loan they will give you. Another question they will ask is if you own land and the value of that land. Many states require you to own land before you can get a construction loan.
There are many steps in a construction loans application. In order to make sure that you have everything you need, you may want to go online and print one out a copy of the application. Once you have the application, you will have a list of all the things you need in order to get a construction loan. Don\'t get overwhelmed by the application just follow it down and do one thing at a time. Answer the questions that you can and then move on to the more complex questions. If you follow the guidelines on the application, then you are much more likely to get a good construction loan.
BACK
|
|
|
