Our goal for our “in house” construction and renovation loan products are to help people achieve their dreams for a particular home or lot that may not have everything on their list of needs. Assurance Financial has very competitive rates and down payment options for Birmingham and Tuscaloosa construction/renovation loans. This loan will be a short term, adjustable, interest only loan for the duration of the construction and renovation process. We must approve the builder or contractor beforehand that will be used for this loan.
How can I use a Construction and Renovation Loan?
A Birmingham or Tuscaloosa construction and renovation loan can be used to purchase and build on vacant land or rebuild an existing structure. Renovations on a purchase or refinance can be used anywhere from updating kitchens and bathrooms to doubling the size of the home. Renovation refinances can help to lower your current mortgage payment and rate while also getting your Birmingham or Tuscaloosa home more up to date.
Construction and Renovation Down Payments
Our Construction and Renovation loan can be used for as little as 10% down payment. Buyers trying to purchase a new home can ultimately just put a 10% down payment on the cost of the lot they are going to build on pending the ending value upon completion.
Construction and Renovation Loan Requirements:
- Down Payment: 10% down is the minimum investment for purchasing a home. If buying the lot first the buyer could possibly take advantage of using just the 10% down payment for the price of the lot not including the cost to build. For refinancing and renovating the buyer must have 10% equity built into the total new loan amount.
- Credit Score: 680 is the minimum middle credit score allowed when taking advantage of the construction or renovation loan.
- Property Requirements: Birmingham or Tuscaloosa construction and renovation properties must meet certain requirements for safety and security. This could be addressed into the cost of building or renovating.
Once the construction and renovation loan is completed the buyer will take out a permanent financing loan through Conventional, FHA, USDA, VA, or Jumbo guidelines (see Loan Options tab). The ending loan to value of the mortgage could require mortgage insurance depending on the permanent financing product chosen.
Working with a Qualified Lender
Assurance Financial is committed to assisting their clients in all of their home loan needs. If you are looking for your very first home or refinancing an existing residence, we can help today. Contact me, Ransom Kelly (205-624-0484), for any questions you may have about any Construction/Renovation loans for Birmingham or Tuscaloosa homes.