Los Angeles Times Article
on Construction Loans
Loan is Trickier When Building Own Home
Los Angeles
Times - Real Estate Section
Sunday, July 6, 2003
By Liz Pulliam Weston, Special to the Times
 If
you buy a home that somebody else built, you’ll have no trouble
finding reams of financing information and lenders willing to help
you.
If
you want to build your own home, however, the road gets rockier.
Construction loans aren’t as
easy to find or understand as traditional 30−year
mortgages. Not all lenders offer construction loans, and those who
do vary widely in the terms, rates and fees they offer.
Few
builders can do without a construction loan, however. Only about
20% of people who build houses pay cash, according to Census
Bureau housing statistics.
If
you are set on creating a home from scratch, you will need to know
a few things about borrowing the money to start turning your dream
into reality.
For
starters, a construction loan is a short−term, interest−only loan
typically designed to be replaced by a regular mortgage once the
home is built. Regional banks, mortgage companies and some
national lenders, including Bank of America and Wells Fargo, offer
these loans.
There are two types
of construction loans:
The
all−in−one loan, also called the rollover or the
construction to permanent loan, which automatically
reverts to a standard mortgage after construction is completed.
The
construction only loan, which comes
due at the end of construction and must be paid off or replaced by
a conventional mortgage.
Continued on Next Page >>
Chicago Tribune
Article on Pre-Construction
Builders Start
to Rethink the Design of the American Home
Chicago Tribune
October, 2003
By Barbara Ballinger Buchholz, Chicago Tribune
Before
applying for a loan for your construction project you must of course
have the right home designed. The following is an excellent article
that will help you avoid the major pitfalls.
Website Editor
Fashions
and furnishings are revamped twice a year; new automobiles come out
annually. But, even though the American home is analyzed several
times a year at industry meetings, its plan and look get only nips
and tucks.
It
continues to evolve slowly rather than getting a major overhaul,
which some architects and builders say is needed to meet the demands
of modern life.
Consider
today’s three and four car garage. It started as a carriage house
when the horse and buggy became obsolete, became a detached space
due to a fear of fire, then a small attached space once fireproof
materials were required. In recent decades, it has morphed into a
big catchall storage area with owners accumulating more things and
basements and attics disappearing.
Altogether,
the average house has grown 50 percent bigger, measuring 2,320
square feet, but it has taken 30 years, says Gopal Ahluwalia, vice
president of research at the National Association of Home Builders
in Washington, D.C.
Our
average construction loan client in California builds a home that’s
over 3000 square feet.-Site Editor.
Continued
on Next Page >>
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