Construction Agreement/Contract: It should state the precise home to be built, exact cost, exclusions, unusual specifications, start date and tentative completion date.
Specifications: The schedule of what will go into your home after the floor plan and design have been determined.
Allowances: The maximum amount the builder will provide for a specific
item such as floor coverings, fixtures, cabinets, countertops, hardware,
etc. If the actual cost is less than specified, you will receive a cash
credit. If costs exceed the allowance, you must pay the additional
amounts.
Change Orders: Modifications to the original contract brought about by
unforeseen conditions or circumstances.
Draws/Disbursements: State Central Credit Union uses a title
company to handle the construction draws and inspections. The builder
normally makes a maximum of four draws from the escrow account.
Typically, they follow the pattern below:
- First Draw: Survey, building permits, excavation, foundation,
backfill, rough grading, culvert, lumber, windows, rough carpentry.
-Second Draw: Gutters, downspouts, sheet metal, rough heating,
rough plumbing, rough electric, roof.
-Third Draw: Insulation, drywall, millwork, cabinets, hardware,
finished carpentry.
- Fourth Draw: Tile, vinyl, carpeting, finished plumbing, finished
electric, finished heating, air conditioning, countertops, mirrors,
shower doors, interior/exterior painting and staining, finished grade,
weather stripping, caulking.
Draw Procedures: Each draw request will be disbursed upon receipt
of the following:
1. Your written authorization.
2. An inspection by the title company confirming that the itemized
work is completed.
3. Receipt of properly signed waivers from the major vendors and
Interim financing allows you to borrow against the equity in your present home to make the downpayment on the lot or the construction of your home.
Pre-qualification will give you an idea of the loan amount that will be available to you for construction of your new home. When you meet with your builder or architect, you can plan accordingly. Pre-qualification also speeds up the loan approval process, leading to faster closings and an earlier start for construction.
State Central Credit Union offers a full array of new construction loans including adjustable- and fixed-rate mortgages. We have designed all of our loans to keep your monthly payments manageable, a great advantage to those who are making mortgage payments on an existing home they have not yet sold.
- During construction, you pay interest only on the builder's draws from
the loan proceeds.
- Your downpayment will be disbursed first since you do not pay any
interest on your own funds.
- No interest is charged on the money that remains in your construction
escrow fund.
State Central Credit Union will give you more than just a competitive interest rate. We will give you personalized assistance from the time you apply for the loan until you pay it off. We have assembled a team of professionals who will thoroughly explain the many financing options we have available.
If you have any questions about State Central's lot or construction loans, please call our Mortgage Department at (414) 778-1000 or e-mail us at
mortgagelending@statecentral.com.