The Construction Mortgage Is Hot Again!

The Houston and overall Texas economy is booming so much that many buyers are considering building their own home. Unless you can convince a builder to build you a custom home on his credit line, the best mortgage for building a home is the Single-Close Construction Mortgage. Basically it is the one mortgage product that allows you to finance your custom-bulit home with minimal costs while mitigating interst-rate risk. In this post we’ll explain the ins and outs of this wonderful mortgage product. An experienced mortgage lender that is well versed in this mortgage product will important in making it a smooth process.

First of all the Single-Close Construction loan means what it says, you have only one mortgage closing that combines your construction mortgage and permanent mortgage into one loan. That means you only have one appraisal for your mortgage not two appraisals, you only have one set of title fees associated with your mortgage not two sets of expensive mortgage title policies, and with only one mortgage closing you only have the lender’s associated mortgage closing costs to pay for one time. So from an economic standpoint the Single-Close Construction Mortgage makes a lot of sense versus having a construction mortgage with all of the related costs and then having to pay for all of those costs again when you obtain your permanent mortgage.

The real benefit of the Single-Close Construction Loan is that your rate for both the mortgage during construction and the permanent mortgage is locked up front. That’s becasue this specialty mortgage product combines both mortgages into one mortgage.

In today’s interest-rate environment where mortgage rates have been rising over the last year, being able to lock your mortgage rate up-front and not 6-24 months in the future is a great deal for the borrower. The Single-Close Construction Loan mitiagtes any future upward mortgage-interst rate risk for the borrower.

Another advantage for borrowers that use the Single-Close Construction Loan is that they only have to put together all of the required and necessary paperwork one time. There is no re-qualifying on the Single-Close Construction Loan when the home is complete.

If you are looking at building your own home The One-Time Close Construction Mortgage or as it is also known the Single-Close Construction loan has too many benefits not to use this mortgage product.

 

 

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