Posted on: 29th Jan, 2010 11:17 pm
What are the pros and cons of builder-financed construction?
Hi annyb,
Builder financed construction loans are easier to get and qualify for than a loan from an independent lender. In case the construction of the home is not complete within specific tine, you can delay the closing. But if you take a construction loan from an independent lender, they will generally not want to delay the scheduled closing. However, the interest rates and closing costs on builder financed properties can often be higher than normal.
Builder financed construction loans are easier to get and qualify for than a loan from an independent lender. In case the construction of the home is not complete within specific tine, you can delay the closing. But if you take a construction loan from an independent lender, they will generally not want to delay the scheduled closing. However, the interest rates and closing costs on builder financed properties can often be higher than normal.
Is it good to use builder-financed construction when having your new home built for you? This is a common issue for homebuyers when securing financing for a new construction custom-built house.
Usually, the question is should the builder take the construction loan and take a permanent mortgage right after construction is completed? Or, the buyer should go for a single construction-to-perm mortgage?
Usually, the question is should the builder take the construction loan and take a permanent mortgage right after construction is completed? Or, the buyer should go for a single construction-to-perm mortgage?