Are you dreaming of building your dream home or renovating an existing property? One Time Close Construction Loan may be just the solution you need to finance your construction project and make your vision a reality.
A One Time Close Construction Loan is a loan that allows a borrower to finance the construction of a new home and the permanent mortgage with a single closing. This means that the borrower only has to go through the application and closing process once rather than applying for two different loans. The loan typically requires a down payment, and the interest rate and terms may vary depending on the lender and the borrower's creditworthiness.
Here are some key points on why a one-time construction loan is essential:
Specific financing: A one-time construction loan provides funding specifically for constructing a new home or renovating an existing property. This means that borrowers can access the necessary funds for construction without relying on other types of financing that may not be as suitable.
Short term: This type of loan usually has a short period, typically 6 to 18 months, designed to match the construction timeline. This means that borrowers can access the funds they need during construction and then transition to a permanent mortgage once the project is complete.
Flexible drawdowns: One-time construction loans typically allow borrowers to draw down funds as needed, which can be especially useful for construction projects where the costs may be spread out over time. This means that borrowers can access the funds they need for each phase of the construction process.
Interest-only payments: During the construction phase, borrowers may only need to make interest-only payments on the loan. This can help keep costs down during the construction process and ensure that borrowers have the necessary funds to complete the project.
One closing: With a one-time construction loan, there is only one closing, which can simplify the process and reduce costs. Borrowers cannot worry about multiple closings and can focus on completing the construction project.
It is important to work with a professional when obtaining a One Time Close Construction Loan to ensure that the process goes smoothly and that you can obtain the necessary funds for your construction project. Here are some reasons why you may need a professional for this type of loan:
Expertise: A professional such as a loan officer, mortgage broker, or construction loan consultant can provide expertise in navigating the One Time Close Construction Loan process, which can be complex and involve multiple parties.
Guidance: A professional can provide guidance on the specific requirements and documentation needed to obtain the loan, as well as help you understand the terms and conditions of the loan agreement.
Connections: A professional may have established relationships with lenders who offer One Time Close Construction Loans, which can help you obtain the most favorable terms and rates.
Risk management: A professional can help manage risk by identifying potential issues before they arise and ensuring that all necessary documentation and approvals are in place.
Time-saving: Working with a professional can save you time by streamlining the loan process and ensuring that everything is in order so that you can focus on your construction project.
We bring a customized, unique approach to mortgages. Our lending solutions use the perfect hybrid of human-driven insights and technical prowess to process loans faster and significantly reduce costs.