5 Things to Consider Before Building
Make these decisions before you break ground.
By: First International Bank & Trust
Build a solid financial foundation, before construction begins.
Pick a lender who knows the process. Your lender can be a big advocate throughout construction. Chose someone you feel comfortable with, and who knows the ins and outs of construction loans.
Consider who will carry the construction loan. Either you or your builder will take out the loan. There are pros and cons to each option.
Understand how changes will impact financing. Upgrades to finishes and floor plans may be tempting, but you need to consider whether your not your loan total will be high enough to cover any last-minute changes.
Lock in your rate if possible. If you're comfortable at a rate quoted for the final loan while your home is still under construction, and a rate-lock is offered, you may want to consider locking-in.
Consider what happens when construction ends. Will your construction loan automatically transfer to a traditional mortgage? Does your lender do a construction to permanent loan, potentially saving you on closing costs and fees?