How a construction-to-perm loan works

1. Talk to me first.Before you sign with a builder, call me. Tell me about the land, the house you want and who's building it. I'll tell you plainly whether it fits and what we'll need.
2. Apply.This is a full documentation loan, so we'll look at income, assets and credit. If you have significant assets, they can be used as income. Apply online whenever you're ready.
3. The land or lot.If you own the land, its equity can count toward the build. If you're buying a lot or tearing down an existing house, we'll work that into the plan.
4. Plans, budget and builder approval.We review your plans, the construction budget and your builder. Your builder needs to be approved before closing, and my team walks them through it.
5. Appraisal on the finished home.The appraiser values the home as it will be once it's built. That after-built value is what the financing is based on.
6. One closing.You close once, on both the construction financing and your permanent mortgage. There's nothing to requalify for later.
7. The build and the draws.As your builder finishes each stage, the work is inspected and the draw is paid directly to your general contractor. My team handles draws in-house, so everyone deals with the same people. During construction you make interest-only payments on what's been drawn.
8. Conversion.When the house is finished, the loan converts to your permanent adjustable-rate mortgage. No second application and no second closing.

What slows a build down

• Plans or a budget that change after approval
• A builder who's slow to send paperwork for draws
• Waiting until after the builder contract is signed to line up financing

Most of that is avoidable with one conversation up front. That's why I ask people to call early.