Designing a home for oneself allows a person to fully express their creativity in the most important place in their lives: their home. In this design issue of Enchanted Homes, Dimond Mortgage is pleased to announce the commencement of the one-time close construction loan. Even though there are many beautiful and functional pre-existing homes available for purchase, the one-time construction loan allows the borrower to create their own living space using their own design plans and location.
This loan program has recently been offered by one of our lenders and allows the borrower to close on construction financing and lock their long-term interest rate upon initial loan submission. Previously, the borrower would be required to secure financing for the construction loan with a separate entity and then close a second time for the permanent financing, thus risking losing market interest rate.
The borrower pays interest only on the locked rate during the construction period for a six-month, nine-month and 12-month term. The borrower can finance up to 90 percent of the appraised value or acquisition costs (cost of construction, which can include “soft” costs, such as architectural services, engineering and permit fees) may be included in the construction financing. The loan terms are for 30-year or 15-year financing. Eligible property types include modular, rural and single-family residences. The amount of disbursement of funds for construction throughout the construction process will depend on the loan amount/term of the construction period. The owner as the builder is not allowed under this program; a licensed contractor is required.
What we can offer is truly the best construction financing, allowing the borrowers to take advantage of their long-term interest rate instead of having to lock in at the end of the construction period. Once construction is complete, the fully amortized payment modifies. Alternatively, there are many wonderful homes in Taos that need a bit of tender, loving care. We also offer a renovation loan program, which allows borrowers to combine the purchase or refinance of a home with the costs needed to renovate or remodel their property. This program allows for 95 percent financing, including “soft“ costs as described in our one-time close program. With the renovation program, the borrower is required to make full principal, interest, tax and insurance payments throughout the construction period. Interest-only payments do not apply.
These two construction options offer buyers the opportunity to realize your dream home. Come to Dimond Mortgage and take advantage of these loan products. If you are considering building your own home, now is the time. Interest rates remain low and spring is in the air.
Donna Nelson has lived in and around the Taos area since 1987. She has been a mortgage professional for close to 20 years. Donna can be reached via email at firstname.lastname@example.org. She is always available to answer your questions.