A construction permanent loan is a long-term permanent loan that modifies a construction loan used to finance a building project. A construction permanent loan can be used to finance many types of residential construction.
This loan allows a borrower funds to construct a dwelling which will then rollover into permanent financing once the home is completed.
In addition to the normal credit package, the following items are required:
- Plans (County Stamped prior to closing)
- Construction Contract with a licensed contractor
- Building Permit
- Hazard and Hurricane Insurance
- 100% Material House Bond usually provided by HPM or Honsador.
The interest rate is locked in prior to loan closing and will carry throughout the term of the loan.
Fixed rate and Adjustable Rate Mortgages are available depending on the borrowers needs. Typical rates run .375% higher than conventional rates.