Building your dream home will be a long process of planning, but it can be done with hard work. There are specific loans designed to lend you a helping hand when you need it most.
Arizona Construction Loans are short-term loans for people on the market to building a new home. They are not given out all at once, but given in increments after meetings with the borrower and home builder, and strong regards to schedule. Ultimately, the loan is given out with each progressive step of the building process. Planning is very important, and because the lender cannot view the value of the home unbuilt, budgets, schedules, and progress visits are compromised with the lender who is heavily involved in the process. Staying on schedule will be important to both you and the lender because fees may increase with missed deadlines and a slowly moving timeline.
Being approved means having a solid plan and production schedule, but also a credit score of 680 and, typically, a down payment of 20 percent. Providing a strong financial history is crucial because proving that you are capable of simultaneously paying extra bills is as important as proving the home will actually be completed.
Receiving funds from a lender may happen with a strong credit score, but it won’t happen with weak plans. Your lender will be interested in reviewing everything your builder touches before handing over a loan. This will help ensure them that the money is going to use at a solid project with qualified people. Lenders providing Arizona Construction Loans are much more involved than other lenders working with other types of loans. In this case, your lender will be very influential regarding the builder, plans, etc. Their approval of your builder and architect will be absolutely necessary. If they don’t believe in your production members, your loan may never be approved. Your lender will likely be a traditional public lender, such as a bank or credit union, whose familiarity with the community makes them a great option for borrowers looking to build in the area.
Types of Arizona Construction Loans
A construction-to-permanent loan converts the loan into a mortgage after the home is complete. With a construction-to-permanent loan, there is only one closing process. A construction only loan is the opposite. Closing costs are paid twice, because the loan is split into both construction costs and a mortgage, requiring the fee twice. Whatever your choice, repayment will begin when construction is complete.
Moving into your Dream Home
Using Arizona Construction Loans to finally move into your dream home is a great option, but one that comes with hard work. Understanding everything that goes into planning, building and scheduling is important because of the way these loans are given out. Finding a strong team of home builders will be important because architects that can’t meet deadlines will hurt you in the loan process. It’s possible to get the white picket fence, but first comes work and planning.
Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
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