EASY BUILD PROGRAM
FOR BUILDING ON YOUR LOT
There are two options when it comes to obtaining construction financing for a new home built on your lot.
Option 1 – EASY BUILD PROGRAM You provide 10% of the cost of new home and lot in either cash or lot equity (If lot is free and clear then 10% of house only). The lot would be conveyed to Builder and your equity (Lot Value minus amount you owe on lot.) in the lot would be a part of the 10% deposit required.
Easy Build Program requires satisfactory pre-construction appraisal of lot and house and lenders commitment for your end loan financing when home is complete.
Option 2 – The customer obtains a construction loan for the new build. The lender will typically lend 75-80% of the cost of land and house. So if your lot cost $50,000 and your new home cost $300,000 then the most a lender would typically lend is $280,000. The home owner would be required to have the difference between cost of $350,000 and loan of $280,000 ($70,000) in either cash or equity. The construction lender will also require having the loan secured by a first deed of trust. This means except that if the lot lender and the construction lender are one and the same, the lot loan would have to be paid off by the owner prior to or at construction loan closing. Those funds could come out of the construction loan so long as it conformed to the requirements mentioned above.
For more information on how this would work for you email us or call 636-462-3500
Any “Easy Build” new home deal is predicated on construction lender approval.
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