Financing Available
What is a Construction 1 Close Mortgage?
CLC's Construction 1 Close mortgage allows home buyers the ability to purchase a lot, finance home construction costs and a mortgage with ONE loan! This program provides financing for up to $417,000 for a primary residence, second home or investment. The loan begins as an "interest only" loan for 6, 9 or 12 months and "automatically" converts to a fixed rate permanent mortgage when the home is complete. The construction loan is based from the total costs as opposed to appraised value. The construction-to-permanent mortgage is a direct loan to the home buyer (borrower).
The borrower makes "interest only" payments during construction based on the total amount of draws disbursed. Once the home is 100% complete, we automatically convert the construction loan into the permanent mortgage and the final Builder draw is released. There are no additional closing fees.
Permanent Mortgage Interest Rate
The permanent mortgage interest rate is locked upfront at closing of the construction loan. The interest rate quoted in Loan Consultant on our website is the "permanent mortgage interest rate". Once the home is complete, principal and interest payments will be based on the permanent mortgage interest rate.
Interest Only - Construction Loan Interest Rate
Add .250% to the permanent mortgage interest rate.
CTP PROGRAM BENEFITS
- A 5%-10% minimum down payment is required for single family, primary residence in non-restricted and non-declining markets.
- Second homes require a minimum 20% down payment.
- Investment properties require a minimum 20% down payment. Full/verified lease agreement required. No spec homes.
- Home Buyer may purchase lot at construction closing.
- Home Buyer applies for financing online and receives an instant approval.
- Loan amounts up to $417,000. Higher loan amounts are considered in Washington up to 70% LTC.
- Up to 10 draws permitted. Draws are disbursed directly to the "Builder" and/or subcontractors within 3 days of CLC's receipt of a draw request. Draws are disbursed based on a percentage of completion. An inspection will be required for each draw.
- Draws are generally funded directly into Builder's checking account by wire transfer (for approved Builders) or directly to the Subcontractors via check. Prior to the first draw, a foundation endorsement and building permit is required.
- Home Buyer makes interest only payments during construction. Once the home is 100% complete, principal and interest payments begin.