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Special Reports
In this section of BrokerUniverse we examine a subject of key importance
for mortgage originators every month, based on special reports that run in our sister publication, Origination News.
Construction Lending: Building the Foundation
Building The Foundation
As refinancings quickly continue to dwindle, the competition for loans in the
home purchase market continues to increase. But most of those chasing home purchase loans are doing so for existing
homes. Even many of those with relationships with homebuilders are only seeking out those builders to finance the
purchase of the property.
There is a niche where there is a need for financing in the builder market and
that is for construction financing.
In particular, a number of wholesale and retail originators offer a single-close
product that combines a construction loan (and its various draw requirements) with permanent financing (which is
your typical first mortgage).
In this Special Report, read about New South Federal Savings Bank and its variations
on the construction permanent loan.
Almost half of the business at Prime Home Mortgage, St. Augustine, Fla., is from
construction-permanent loans. This product, the company said, is immune to rising interest rates.
There are a number of other lenders, some of which displayed at June's National
Association of Mortgage Broker's annual convention, that offer their broker clients the opportunity to do this
business.
Many other brokers have made it a point to call on builders, even if the builder
has an in-house mortgage company. There is a good chance these in-house firms only do "vanilla" product.
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