video: What Are Construction Perm Loans?

 

Like the man in the Fast Forward video says, a blueprint is not a house - so conventional home mortgages do not apply to construction projects.
However, most blueprints become houses - so loans that cover construction, then convert to permanent mortgages or construction perm loans are fairly common.
The construction loan phase is frequently a variable-rate loan, with scheduled loan draws to match construction stages.
Upon completion - usually a certificate of occupancy - commonly called a CO - the construction loan is converted to a permanent mortgage.
The advantage of construction perm loans is that you only need ONE application and ONE closing.
Compare interest-rate trends to your construction schedule (and assume construction delays) to evaluate if a rate-lock agreement on the permanent mortgage stage makes sense.
And weigh your construction-loan terms and their short-term cost against your mortgage rate, and it is probable long-term costs.
Compare lenders to get the best construction perm package for your situation.

Brand and license this video, plus hundreds more, for your mortgage, title or real estate business. More Info Here.