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Construction Loans More Info

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$100 LandingAbout Construction Loans

When looking for the perfect home, you may decide to build a house from the ground up. GTE Financial’s Construction Loan offers the convenience of a one-time loan application, loan approval, process documentation and loan closing that will cover both the construction and permanent mortgage once you move in. This will save you from having to apply and be approved for two separate loans.

What is a Draw Period?

The Construction Loan offers a building “draw period” where the lender will disburse loan funds during the course of construction based on an inspection of the property and on an estimate of time to completion. During the draw period, the owner is responsible for interest payments only. Once the home is finished, with a final inspection and certificate of occupancy, the loan will transition into the permanent mortgage loan. At that point, standard mortgage payments based on the permanent loan Annual Percentage Rate will begin.

Quick Construction Snapshot:

As part of the building process, in order to obtain a Construction Loan, some of the steps you may need to perform include:

  • Purchase a piece of property to build your home on.
  • Hire an architect or builder to develop the home plans for you.
  • Hire a lawyer to prepare any necessary legal documents.
  • Hire a builder or contractor to complete the construction of your home.
  • Create a construction budget and a construction timeline.

Homeowners will typically apply for a construction loan once permits are in place. When trying to estimate how much a home building project will cost, here are some factors:

  • The land you are building on, considering factors like city, county and state.
  • Home design.
  • Construction cost.
  • Cost of financing.

Speak to a Home Loan Specialist today to learn more about our fantastic Construction Loan!

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