| of people dream about building a new home. | | | | the subcontractors who will be working on your |
| Everyone wants a home that will work with their | | | | house, for example, masonry, electrical, landscaping, |
| lifestyle and reflect their character and be original and | | | | etc.) and the costs of financing, which will give you |
| attractive to the eye. Getting a construction home | | | | the total cost of building a new home. |
| loan can be a scary task. Residential construction | | | | It is always a good idea to pre-qualify for a |
| loans are different from traditional home mortgages | | | | construction loan. The process to pre-qualify takes |
| in many ways. | | | | into consideration your credit record, any down |
| There are several types of residential construction | | | | payment you can make, the type of loan you want, |
| loans to choose from. If you choose the owner | | | | and the current market value of homes. If you |
| builder loan, this means you are acting as the general | | | | pre-qualify, you will know up front the amount of |
| contractor and you are solely responsible for the | | | | home you can afford to finance and build. |
| construction getting completed on time and within | | | | Not all residential construction loans are alike. Many |
| budget. A custom contractor loan has the contractor | | | | are based on a six-month or one year plan, which |
| being responsible for making sure that the | | | | means they will be completed within that time frame. |
| construction gets done. A remodel or addition loan is | | | | Some allow you to lock in your interest rate at the |
| for when you love your home and your | | | | lowest rate, and others are variable interest rate |
| neighborhood and don't want to move but need | | | | loans, which means the interest rate changes with |
| more space. This loan takes into account how much | | | | the market. Other loans are bridge loans, which allow |
| the house will be worth after the addition or remodel. | | | | you to use equity from your current home until your |
| There is also a tract or subdivision loan, which is the | | | | new one is finished. Many require interest only |
| kind of loan you will need if you decide to build a | | | | payments until the house is completed; at which point |
| house in a subdivision, choosing from the builder's | | | | those payments are due. The best choice is to get a |
| standard house plans and adding any upgrades you | | | | construction loan that can be converted into a |
| want. | | | | mortgage loan so that you only have to fill out one |
| When you think about building a home, you have to | | | | application and have the costs associated with one |
| figure out how much it is going to cost you. You | | | | closing instead of two. |
| take the cost of the building site, (keeping in mind | | | | Building a new home does not have to be scary if |
| that this includes both the asking price of the site | | | | you do your homework, plan well, and realize that |
| and the costs to develop it), your home design, the | | | | not everything will go according to the plan. |
| construction costs (this must include quotes for all | | | | |