Finance Your Dream Home
Can't find the perfect home to buy? Looking to build the home or your dreams? Or maybe, you're thinking its the perfect time to renovate the one you currently call home? The process of borrowing the money to pay for this project is different from getting a mortgage to move into an existing property.
Construction Loan Basics
What Is A Construction Loan?
A home construction loan is a short-term, higher-interest loan that provides the funds required to build a residential property. Once the home is built, the prospective occupant must apply for a mortgage to pay for the completed home.
What Does A Construction Loan Cover?
A construction loan can be used to cover the cost of the land, contractor labor, building materials, permits and more. While items like home furnishings generally are not covered within a construction loan, permanent fixtures like appliances and landscaping can be included.
Are There Higher Qualification Requirements For Construction Loans?
The short answer is YES. Often times, construction loans come with higher qualifying standards in terms of credit requirements and down payment amounts. Usually a minimum 20% down payment is required, and a 25% down payment requirement is not uncommon. In addition, most construction loans require a minimum credit rating of 620.
The Home Construction Loan Process Explained
Building the home of your dreams is exciting. Just as a solid foundation is important to any well-constructed house, financing is critical to the construction process as a whole.
Construction Loan Resources
The Construction Timeline In 6 Easy Steps
As the age-old idiom goes, “Haste makes waste.” That proverb applies in numerous situations, not least of which is the process of building a sturdy and high-quality house. Understand the timeline to building the house of your dreams by downloading this quick infographic.
The Breakdown: Construction Loan Costs
Understanding the intricacies of a construction loan is important, but we know that for many of you, the only thing that really matters is knowing what you will be expected to pay. Let's breakdown the standard costs association with this loan structure.
What To Expect During Underwriting
Did you know that your finances go through a process called underwriting before you can officially get a mortgage? Underwriting is a crucial component of the home loan process because you can’t get to closing until your lender's team completes the underwriting for your mortgage. Let’s dive in and learn more about the underwriting process.
When you work with NorthPort, you’ll receive prompt, personal service that enhances your borrowing experience. We provide real-time updates & market data, that keeps you updated every step of the way, creating a simple and transparent experience. With NorthPort, you can expect a high touch and high-tech experience. Our Instant Prequalify Technology allows you to see if you are qualified to buy a home without affecting your credit score. We have built a business that is recognized for integrity, excellent service and efficient processes.
Knowledge Is Power
What Are Mortgages Fees?We know the questions on your mind when it comes to mortgage fees-WHAT are they and WHY do I pay them? At NorthPort Funding, we set out to streamline the mortgage process. In doing so, we’ve eliminated nonessential fees, unnecessary steps, and time-wasting appointments. Our efficiency not only makes it easier to buy a home, it translates into the best rates available.
Physician Home Loan Vs. Conventional LoanThere is a very distinct difference between physician home loans and conventional loans. They are more commonly known in the lending world as a portfolio loan. A portfolio loan is a mortgage that is borrowed from the lending institutions balance sheet or deposits and held with that bank until the home is refinanced to another lender or the home is sold. Because the bank is lending its own money, it is taking a calculated risk by not taking out a mortgage insurance policy or by paying for it outside of the loan. A conventional loan is secured by an investor and a servicer, where the mortgage can be pooled together with other similar mortgages and sold. Because of this process a conventional loan does require PMI or private mortgage insurance to cover losses potentially incurred by the investor should a borrower fail to repay the mortgage.
What Is The Biggest Difference Between A 15 vs. 30 Year Mortgage?There are advantages and disadvantages to both 15-year and 30-year home loans. The interest rate is lower on a 15-year mortgage, and because the term is half as long, you'll pay a lot less interest over the life of the loan. Of course, that means your payment will be higher, too, than with a 30-year mortgage. Consult with the mortgage experts at NorthPort Funding and review your personal goals and options when it comes to the structure of your loan. With NorthPort, you can expect a high touch and high-tech experience. Our Instant Prequalify Technology allows you to see if you are qualified to buy a home without affecting your credit score. We have built a business that is recognized for integrity, excellent service and efficient processes.
Can I Afford A 20% Down Payment On A New Home?The 20% down payment rule of thumb is a way to manage your costs when buying a home. By making a down payment that’s at least 20% of the purchase price, you often avoid extra monthly expenses and pay less interest than somebody who buys with a smaller down payment. However, putting less than 20% down allows you to diversify your extra cash into a savings “safety net.” Let’s review the rule in detail so you can make informed buying decisions, learn rationale behind the 20% figure, and explore alternatives so you can decide on the right down payment amount with the mortgage experts at NorthPort Funding.
Are Interest Rates The Same At All Lenders and Banks?