Building your dream home doesn’t have to be complicated. Our one-closing loan product and personal approach to loans makes us the ideal partner for a construction loan. Continue reading for our step-by-step guide to single-close construction loans and learn how to turn your dream home into reality.
Step 1: Can I receive a loan for my construction?
Types of Property:
- 1-2 family owner occupied residences
Construction Methods:
- Stick Built
- Modular
Maximum Loan to Value is 80% of appraisal value
Step 2: What do I need to provide for approval?
- Third-party estimates and contracts for all construction costs
- Proof of payment for work already completed, if applicable
- Copy of plans and specs
- Most recent two years W-2’s
- Paystubs covering 30 days
- Two years Individual Tax Returns, if applicable
- Two years Business Tax Returns, if applicable
- Two months bank, retirement and/or investment statements showing sufficient funds to close
- Must show the ability to cover 15% cost overruns
- Satisfactory appraisal
Tip:
Carefully review your Commitment Letter and the attached disbursement schedule
Step 3: What do I need to schedule a closing?
- Homeowner’s Insurance Quote
- Letter from assessor estimating taxes once completed
- Copy of your building permit
- Certified Survey- We will provide the certifications once your title report has been ordered
- Title Report
- If your construction is underway, you will need to provide a copy of the builder’s risk policy in the borrower’s name and listing Wallkill Valley Federal Savings and Loan’s mortgagee clause
- Final underwriting clearance
What type of survey will I need prior to closing?
If your foundation is not completed, you will need a boundary line survey showing the proposed location of the home, well, septic, driveway, etc.
If your foundation is completed, you will need to submit a foundation location survey. This is a boundary line survey showing the actual location of the foundation.
Step 4: What happens at the closing?
- You will sign all necessary documents with the bank attorney and a representative from the title company
- You will provide three original copies of the certified survey
- If you elect to take a land advance up, you may receive up to 75% of the land value given on the appraisal, you will receive this check
- If you had other work completed, you will receive this disbursement in accordance with the percentage completed
Important to note:
Closing costs and any liens (i.e. land loan) will be deducted from disbursements given at closing. This may result in you needing to bring funds to closing.
Step 5: How do I receive my construction funds after the closing?
Disbursements are based on the percentage of work completed
- You will contact the Loan Servicing team to order an inspection
- Provide builder’s risk policy in borrower’s name, if it is not already on file. It must list Wallkill Valley Federal Savings and Loan’s mortgagee clause.
- If a modular, provide liability insurance for modular manufacturer, set crew and crane.
- A title rundown will be conducted to ensure no liens have attached to the property. If they do, you will need to satisfy the lien prior to receiving the disbursement.
- If you are looking to receive a disbursement for your foundation, you will need to provide a certified foundation location survey.
- Two original copies of a final “as built” certified survey is required once your construction is completed along with a Certificate of Occupancy before final funds can be disbursed.
Tracking Your Estimates for a Stick-Built
It is important to keep in mind that every build is different and cannot be compared. Below is a list that is intended to help guide you through obtaining estimates or talking with your builder, but you may have additional line items depending on what you choose to include in your house. For example, you may decide to add a fireplace, pool, exterior buildings, heated floors, etc. It is important for you to stay organized and provide as much detail as possible to help yourself, us and the appraiser!
- Site Work (Clearing, grading, etc.)
- Excavation
- Driveway
- Foundation
- Deck/Patio/Porch
- Septic
- Well
- Framing
- Roofing
- Siding
- Windows
- Exterior Doors
- Garage Doors
- Electric
- Plumbing
- HVAC
- Insulation
- Drywall
- Flooring
- Kitchen Cabinets
- Kitchen Countertops
- Appliances
- Bathroom Fixtures (Vanity, countertops, etc.)
- Bathroom Floor
- Shower/Tub and Toilet(s)
- Interior doors and trim
- Paint
Tracking Your Estimates for a Modular
Keep in mind that no modular is the same. You may decide to choose an all-inclusive modular or just a shell and customize all finishes. Below is a list that is intended to help guide you through obtaining estimates or talking with your builder, but you may have additional line items depending on what your modular comes with. It is important for you to stay organized and provide as much detail as possible to help yourself, us and the appraiser!
- Site Work (Clearing, grading, etc.)
- Excavation
- Driveway
- Foundation
- Deck/Patio/Porch
- Garage
- Septic
- Well
- Roofing
- Modular
- Crane and Set Crew
- Electric
- Plumbing
- HVAC
- Flooring
- Appliances
- Interior doors and trim
- Paint
Ready to get started?
Click the link for our Online Loan Application or contact one of our residential lenders to get started today!
