Building Your Dream Home Is Just A Loan Away
Building your dream home is just a loan away. A construction loan entitles you to a line of credit for the period of time that it takes to complete your home building project. It’s also an affordable option for a first-time home builder, unlike a conventional fixed-rate mortgage loan, you’ll pay interest only on what you draw. For example, if your construction loan is $500,000 and your builder draws $25,000, you’ll only pay interest on that first $25,000. Towards the completion phase of your project, your loan will need to be rolled into a permanent mortgage loan in order to pay off the remaining balance of your property. Construction loans are high-risk for banks and lenders, making qualification requirements quite stringent.
Hire a reputable builder. It’s pertinent to have a licensed general contractor on board with your project to assure it’s built using best practices in the industry – a project gone wrong would surely cost you. Lenders will require the expertise of a professional and will likely reject instances where the homeowner is the acting contractor.
Provide detailed specifications of your project. Building plans and specifications of materials used for the project, along with the estimated value of the land will be considered when a new construction home project is required to be appraised. This serves as a basis to determine whether or not the property can be used as collateral for the loan.
Built-in Equity. With CU Network Services, you don’t need to spend money upfront to jumpstart your new construction project. Construction loans are made up of 80% of the value of the building plans and land combined. In Hawaii, it’s common that a new home will have 20% equity built in.
If you’re looking to build or renovate a customized home tailored to fit your desired lifestyle, finance your home building project and build the home of your dreams with a specialized non-bonded construction loan. As one of only a select few Honolulu-based lenders of owner-builder construction and land loans, the Home Loan Specialists at CU Network Services will walk you through the process and help you evaluate your financing options. Call them at 529-4599 or visit their office at 715 S. King Street, Suite 100.