Construction/Permanent Financing

 

We will make your loan decision easier by helping you choose the financing program that best fits your needs.

One time closing allows you to save hundreds or thousands of dollars in closing costs that you would have had to pay with other programs. You can choose the financing that best fits your needs.  We offer everything from low down payment financing to our interest only programs allowing you to manage your monthly cash flow.

We also offer a variety of other construction loan products that will give you the flexibility you need from a mortgage broker.  Your interest rate can be fixed or adjustable.  You can choose your term for the construction period and your permanent mortgage as well.

We offer solutions for interest rate worries in which you can lock in the rate prior to building your home.

Building a home is a lot less work when you leave the financing with a Stepping Stone Mortgage Consultant.

As each stage of the construction ends, loan professionals will approve the release of the funds to pay your builder and any subcontractors.  Inspections will be made for each disbursement to verify the improvements completed and are appropriate to the disbursement requested.

During the construction phase, you make interest-only payments based on the amount that has been paid to the builder.  As the principal balance increases, so will your interest only monthly payments. You will receive an interest bill every month for the amount of interest due.  Your construction phase payments will not include escrows for property tax and insurance renewals.  A portion of these interest only payments may be tax-deductible.  As always, you should consult a tax advisor for details.

Once your home has passed its final inspection by the appraiser and local building authorities, you may need to sign an agreement modifying your construction loan into a permanent mortgage, if any of the original terms have changed.

When you apply for a construction loan, you will need to provide these items in addition to the normal application and documentation required:


1) A fully executed copy of the contract with all addenda with your builder including amount of actual costs signed by both the builder and borrowers.
2) Your complete set of house plans signed and dated by both the borrowers and builder with specifications of materials.  Construction cost breakdown.
3) A copy of the lot loan contract (or the copy of the deed if you already own the lot).
4) Copy of Builder’s license, Builder’s references, suppliers, sub-contractors and previous clients.
5) Copy of Builder’s General Liability Insurance with evidence of Workman’s Comp coverage.

First draw-Additional requirements:

All funds that you will contribute to the purchase and construction of the property prior to the first construction disbursement must be paid before any disbursement of funds.  You must supply receipts for any items purchased or paid for outside of the construction contract.
Building permits - copies of all permits and other applicable governmental approvals to include septic/well permits.
Footer and foundation survey-verifies the foundation of your home has been placed correctly on your lot without violating any easements or setback requirements.

Final Draw Requirements:

Final billing from builder-verifying the amount of any cost over-runs or changes and the final balance due.
Final inspection-Verifying the improvement are 100% complete including driveways, sidewalks, grading or seeding.
Certificate of Occupancy -a final unconditional certificate of occupancy issued by the appropriate jurisdiction.
Final survey-Verifying the completed improvements do not violate any easements or setback lines.
Final title insurance policy -with all endorsements.
Homeowner’s insurance policy-in an amount equal to the lesser of 100% of the insurable value of the improvements with replacement cost coverage of the improvements or the loan amount.

Construction Contractors Board (CCB)