No Out of pocket payments during
construction
Easy Qualifying including Stated
Income
Credit scores as low as 540
No Contractor required
In addition to the loan programs listed below, we also have financing available for Spec Homes and Home Improvement projects. We have loan programs for No Ratio, Stated Income, and Investor Rehab/Remodels. One point to remember is that loan rates change daily. The rates quoted are only valid on the date of this writing. Please call, or e-mail us for a current quote.
FIXED RATE OWNER BUILDER CONSTRUCTION LOAN:
These are loans that are solely for the purpose of constructing the house and do not convert automatically to your permanent mortgage. They will typically be from six to twelve months in duration. Owner Builder Financial Services offers a wide variety of competitive permanent mortgage programs called "takeout" loans to pay off your interim construction loan when it comes due.
You might wonder why a person would choose to use a interim loan instead of a "roll over" loan. While we understand that nobody wants to pay for two appraisals, $300 each, and two escrows, depending upon the amount of the loan, about $1000, there are some benefits to choosing using an interim loan program. The reasons might be speed, easier qualifying, better long term loan rates.
Our interim loan programs do not require an "interest reserve account", or a "contingency account". If you needed $150,000 to pay for the land and construction an interest reserve and contingency account could increase your loan amount by about $20,000. That means you would have to borrow , and pay points and fees on $170,000.
Our interim loan amount is based on the appraised value not the actual cost. Many programs are based on 80% of appraisal or
90% of cost, which ever is less. This means that you would have to put in 20% of the costs. It will probably take less cash out of pocket using an interim loan program.
A lot of effort has been expended by the people who sell these "rollover programs to make you believe that it is foolish to use two loans when you are only building one house, but there are sometimes other more serious considerations than two escrows.
Owner Builder Financial Services will place your permanent loan with a wholesale source that offers zero point loans.
ROLLOVER LOAN PROGRAMS:
This loan program automatically converts to a 30 year loan at the completion of construction. One escrow closing, one appraisal, one signing and you have both construction and long term financing.
Construction Term:
6 – 9 – 12 months
Lending Area:
All of California
ROLLOVER CONSTRUCTION LOANS, FLOATING RATE CONSTRUCTION LOANS UP TO $3,000,000
Terms:
12 months for construction. Interest only on disbursed funds during the construction period, then converts to a new rate, fully amortized Payments.
90% loan to appraised value to $400,000.
80% loan to appraised value to $650,000.
70% loan to appraised value to $1,000,000
Lending Area:
All of California, Nevada, Colorado
FIXED RATE CONSTRUCTION ROLLOVER LOANS, NOT FLOATING. THE RATE IS THE SAME FOR CONSTRUCTION AND FOR THE BALANCE OF 30 YEARS.
NO PREPAYMENT PENALTY
Construction Term:
6, 9, or 12 months for construction. Interest only on disbursed funds during the construction period, then converts to fully amortized Payments.
Lending Area:
All of California
REMODELING LOAN PROGRAMS:
When you are remodeling or making an addition to your home, there are a few options available for financing.
The first consideration is to evaluate if it will be advantageous to keep the existing first mortgage and create a second mortgage to finance the new work. Generally speaking it is probably better to finance the construction project with a straight construction loan, as described above, unless there is a large difference in the current market interest rates and the rate you have on your current first mortgage. In today's market this is not the case. Most mortgages today are in the 7% +/- area and it is unlikely that your first mortgage is much lower than this.
Another consideration to remember is that any time you refinance you begin a new 30 or 15 year loan and perhaps you only have a few years left to pay on the existing first and do not want to start over again. If this is the case, it may be to your advantage to use a second mortgage as financing for your construction project.
If you choose to use a straight construction loan we will payoff the existing first mortgage when the construction loan documents are signed. You will then be making interest only payments on that amount of money. The balance of the funds will be disbursed to you as you make progress on your remodel/addition. Once the project is complete the construction loan will convert into a 30 or 15 year mortgage, ARM or Fixed depending on the program.
NO PREPAYMENT PENALTY
Lending Area:
All of California
LAND LOANS:
We believe that it is in your best interest to close on the land and construction loan at the same time. We advise our borrowers, when purchasing land, to try and negotiate for the seller to carry for a couple of months, or allow an extended escrow, 60 -90 days. This will allow you to select an architect or designer and generate at least a preliminary set of plans. We can often appraise off the preliminary plans. Once we have the appraisal, we can often close the land and construction at the same time saving you thousands of dollars in fees. Of course, sometimes this is impossible and if you do have to obtain a separate land loan, the following is one of our land loan programs.
Term:
24 months. Payments are amortized based on a 30 year loan.
Lending Area:
All of California
In addition to the land loan programs shown, we also have loan programs for Log homes, kit homes, and manufactured homes.
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