Construction Loan Nevada Arizona Property Mortgage

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Construction lending over the past year has all but disappeared. Most construction lenders have discontinued programs or simply gone out of business. At least 2 top lenders, CTX and First Horizon, stopped honoring their commitment to convert borrowers' construction loans to permanent (One Time Close), leaving those borrowers in search of new financing, new costs and sometimes foreclosure. Not pretty!

Construction lending is still available, but the rules have certainly changed. Unless you already own a lot, have plans and a contractor in place, it may be better to buy a pre-existing home. Many custom homes, especially spec homes, if they have not already gone back to the bank, are an incredible deal right now. Now is not the time to build! Call me to discuss options and ideas.

Bruce Specter is a home construction loan expert. Primary residence or 2nd Home. If you're thinking of building a home in Nevada, whether for yourself or as a builder, then there are many plans and decisions you will need to make. You will be calling upon the talents of many experts to help you along the way. Having been through the process a time or two, Bruce has the type of expertise in construction lending you can rely on to guide you through the building process. Bruce can answer your questions or your contractor's, so your construction loan keeps moving. The construction loan is a One Time Close loan, meaning that with one application, you get all the financing you need - construction loan and permanent loan combined into one. Please contact Bruce Specter at any time for additional information on any of these features.

Program Benefits

Program Details

Lot and Land Loans

Remodel Refinance Program

Available Mortgage Products

Program Benefits

The Program

	Loans to $2.5million - always at competitive rates
	Full Documentation or Stated Income options
	Streamlined application process
	6-, 9-, 12-, or 18 month construction periods
	At completion of construction, permanent financing guaranteed at no additional cost.
	Borrower my pay down principal at completion of the project when the loan converts to permanent financing (Re-Amortize, lowers loan amount, lowers payment)

Benefits to the Borrower

	One closing. One set of closing costs.
	No private mortgage insurance is required during the construction phase
	Interest only payments made through construction phase
	Financeable Interest reserve established to accommodate periodic interest payments during construction
	No Re-qualification at the end of construction (you qualify just once at the beginning)
	Financeable contingency reserve established to accommodate unexpected, but necessary cost overruns

Benefits to the Builder

	Increased cash flow as profits received during construction - not at close
	Builder can pay real estate agent fees at the start of construction
	Quick and efficient draw process allows the builder to draw whenever needed (draw on demand)
	Quick builder review process - no financial statements or tax returns are required

Talk to Bruce Specter about our competitive rates and programs.

See the Frequently Asked Questions page for additional answers to common construction loan questions.

Program Details

The Construction Loan Program is designed to allow a borrower to build a home using a licensed general contractor and permanently finance the home with one loan closing. The applicant may purchase a lot along with the new home construction or have the home built on a previously purchased lot.

While the program is known as a One Time Close or Construction to Permanent, the loan has two distinct phases:

	A construction period up to 18 months (Interest Only Payment)
	A permanent phase (Fully amortized home mortgage)

Loans with 6-, 9-, 12- or 18-month terms are available. During the construction period, the loan payments are interest only. The payments are based only on the amount that is paid out to that point. If elected at application, these payments are made from your interest reserve (meaning no out-of-pocket payments made through construction loan phase).

Once the construction loan phase is complete (property is ready to move in) the loan moves into its permanent, amortized phase (becomes a traditional mortgage).

This is a fantastic program for a financially responsible low to middle income buyer. For further details on the program or to pre-qualify, please contact Bruce Specter at your convenience or send me an e-mail.

Lot and Land Loans

Loans on improved lots or land (there is a lending difference between a lot and raw land) are available, whether you intend to build within a year, or are holding the property for investment purposes. These programs range from short-term balloon (where the balance is due in short period of time, usually 1-5 years). The longer term lot loans are no longer available.

Keep in mind buying a lot in an established neighborhood can be a lot different than buying rural property. I always advise my customers to do their due diligence when it comes to buying a lot or land. I am always available for questions.

Lots already owned can also be refinanced to lower your monthly payment. You can also pull cash out of your lot or land, depending on how much equity you have (an appraisal can determine that).

Our lot loans feature:

Flexible rate and program options, including 1, 3 or 5 year balloon with Interest Only Option

Ability to amortize up to 30 years

Ability to provide Spec financing for custom builders

Ability to provide Acquisition and Development financing for sub divisions

Ability to finance up to 90% of the purchase price

A 60 day rate lock

Ability to finance through our Construction/Permanent Loan Program

Frequently Asked Lot Loan Questions:

Q.	What is a "finished lot"?

A.	A "finished lot" refers to a portion of land that already has road access and utilities in place to the lot boundary. Additionally, it has been approved by the city or county as a separate parcel of land on a parcel map.

Q.	Can I buy a piece of land that is not a finished lot and save some money?

While it may be possible to purchase an unfinished lot, generally this is not advisable for an individual building their own home. The costs of bringing roads and utilities to the first lot in a new area are usually very high. Typically, the first person to build pays for others who will build later. There are land developers who specialize in preparing lots for building (this may include zoning and/or soils issues, as well as bringing roads and utilities to the site, and creating a building pad). Often, these lots are in a planned community.

Q.	What do you mean by "planned community"? Aren't all communities planned?

No, many older communities were not planned; they evolved. Certainly, as a city has grown, plans have taken shape. But in many cases the nucleus of a community was started many years before the community or city planning existed. In many instances, it is this unplanned characteristic that gives a community its charm.

A planned community, in contrast, generally offers a specific style and certain amenities at a package price. Depending on the size and location of the community, these amenities may include greenbelts, landscaping, biking trials, swimming pools, even schools and shopping centers. Some amenities, such as the community pool and greenbelts, are paid for through a homeowners' association. Others are paid through taxes or special assessments. Still others are design enhancements intended to encourage potential buyers to purchase in an area or to attract more commercial business.

Many of the more costly amenities included in a planned community may not be affordable for a homeowner on an individual basis. However, some of these amenities may not be important to you. After all, priorities, like lifestyle, vary. If you select a home in a planned community, you'll generally have a more structured community where decisions are made jointly rather than by the individual homeowner. These community decisions include individual home design and landscaping. While some homeowners may consider this an acceptable trade-off to ensure an attractive environment, others may consider it an infringement on their rights. It's important that you know how you feel before selecting the type of lot you want.

Q.	Can tax bases differ within the same community?

Yes, they can. While some cities already have parks, schools, and streets, newer communities built within the same city may have special assessments that cover the costs to develop or maintain new or existing parks, schools, streets, etc. These assessments may be for a prescribed period of time or may continue indefinitely. A little research goes a long way. Here again, a good real estate agent or title company officer can often provide you with this information.

Q.	I've found the perfect location, but I'm not ready to build my dream home. Can I obtain financing for the land only?

Yes, you can obtain a Lot Loan. Typically, this is short-term financing f(1-5 years, though 20 years is available) or the purchase of a residential lot suited for future construction. This loan allows you time to select an architect, builder, and design your dream home. Our Lot Loan programs allow you to finance up to 50 acres. And when you're ready to build, we offer a one-time close Construction-to-Permanent Loan.

For further details on the program or to pre-qualify, please contact Bruce Specter at your convenience or send me an e-mail.

Remodel Refinance Program

This program allows a borrower purchasing or refinancing a home to include funds for renovation and/or upgrading work all in one loan. Renovation/Remodeling funds up to $50,000 are held in an escrow account and disbursed as the work is completed. If the improvements are non-structural, a General Contractor is not required. Amounts over $50,000 would require construction program, as explained above. Both Fixed and Adjustable Rate programs are available for this program.

If you or someone you know needs some expert counseling on this program, call me.

Available Mortgage Products

The following loan programs are available:

	3/1 and 5/1 Adjustable Rate Mortgages (fixed for first 3 or 5 years) with 15 or 30 year terms
	15-, 20-, 25-, 30-year Fixed Rate Terms
	Low Documentation / Stated Income (3/1 and 5/1 only)
	Loan to Values to 90%

For more information, call Bruce Specter at (775) 338-6915.

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This page was last updated on 07/28/08.