Taking the time, now, to educate yourself about the new construction loan process is important. Doing so, can save you time, money, and an enormous amount of patience along the way. These are things you need to consider before signing for a construction loan on your new home.
Many new construction loans are two-part loans. The first loan covers the costs of building the home, while the second loan is the actual mortgage loan. With this type of loan, home buyers end up paying closing costs and associated fees twice rather than within a single transaction.
A common alternative is to choose a two-in-one loan, sometimes referred to as a construction to permanent loan. This loan often only requires one closing costs and makes the transition with you once the build is complete and you take possession.
The other downside of a two-close new home construction loan is that you must qualify separately for both the construction loan and the permanent mortgage loan once the construction is complete.
Choosing a lender that allows this option allows you to save large sums of money related to closing costs for you loan. Plus, it only requires a single-stage application process for the full scope of your mortgage loan.
Midland Mortgage is dedicated to helping South Carolina residents build their dream homes one mortgage at a time. We offer new construction loans as well as construction to permanent home financing to customers while assisting you in overcoming many challenges that would make other lenders balk. Contact us today to learn about your new construction loan options and how we can help.