Are you ready to build your new home or simply add on to the current home you have? The key to starting your construction project will largely depend on acquiring a loan. It is important to bear in mind some lenders have stricter rules and guidelines than others for the borrower to follow. However, by relying on a few simple tips before applying for a loan, this will prepare you for loan application success.
Know Your Options
Do you want a construction loan that will allow you 10, 15 or 30 years to repay? What about your interest rate demands? Do you prefer a variable or fixed interest rate when securing a loan? One of the first things you may want to consider is the type of loan you need in order to save you time and money over the course of your loan. Many people prefer borrow money for the shortest amount of time possible.
You are the person in charge when looking for a construction loan. The lender works for you when borrowing money from a financial institution. Take the time to shop around and know what options are available to you. Look at the various annual percentage rates and find the one that best suits your needs. Keep in mind the lower your interest rate is, the more money you will save on a monthly and long-term basis.
There is nothing worse than getting excited about a new home or remodeling project and not being capable of obtaining a loan to complete it. The best way to avoid this disappointment is by contacting your lender of choice and getting pre-qualified. This means the financial institution you choose to borrow the money from for your loan agrees to lend you a certain amount before initiating the loan.
Be forewarned that a construction loan is often referred to as a story loan. This means you need to be prepared to provide your lender with the necessary information regarding what type of construction the money will go towards when building or remodeling. For example, are you building a new home, upgrading the kitchen or adding a swimming pool in the backyard? Do you require the services of Zoomlion Cranes to help you with construction? Specific details are necessary to give your lender when asking for any construction loan.
Submit Your Loan Application
Once you have completed the tips above, it’s time to apply for your actual construction loan. It is important to remember to be detailed and concise on your application. Be sure to provide only accurate personal and financial information to aid you in securing the loan.
Be prepared to list your annual income, your address, and the amount of money that you wish to borrow, as well. Additionally, be certain to have a W-2 on hand to submit with your loan application. This will verify to the lender the amount of your income to aid in securing the loan.
Finally, the key to getting the loan you need and saving money in the short and long term will rest on the construction loan you are capable of securing with your lender.