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Home Loan
  Basic Home Loan Terms Explained

  Sound Advice on Home Loans
  How to Secure a Construction Loan For a True Modular Home
  Important Information On Home Loan Refinance
  Are You Qualified For A Home Loan Refinance?
  How To Get The Most Favorable Home Loan Rate Deal
  Pay Home Loan Off Quickly


Home Equity Rate
  Best Home Equity Rates - How to Land One

  Important Factors When Cashing Out





Bad Credit Home Loan
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Secured Home Loan
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Home Equity Mortgage
  4 Tips That You Should Follow Closely



Home Equity Loan n
  Home Equity Loan - Advantages and Disadvantages

  How to Borrow Money by Cashing Out Home Equity
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  Home Equity Loan - Advantages and Disadvantages
  Sound Advice on Home Loans
  How to Secure a Construction Loan For a True Modular Home
  Important Information On Home Loan Refinance
  How To Get The Most Favorable Home Loan Rate Deal
Home Loan Articles
Basic Home Loan Terms Explained
The wonderful world of home buying can sometimes overwhelm the first time home buyer. They are inundated with information riddled with terms of art. ARMS, points, interest rates, good faith estimates, pay-downs, lock-in dates, so on and so forth... Read More
Thursday, November 6, 2008
How to Secure a Construction Loan For a True Modular Home
Construction Loans for Modular Homes

A construction loan for a true modular home built to local and state building codes will offer the same interest rate compared to traditional construction loans. There is no difference in the rate or term of the loan, they are the same. So, you may be asking yourself, what is a true modular home? A true modular home or sometimes referred to a system built home is a custom built home, built in a factory out of the weather compared to a stick-built home constructed on site.

The modular units when completed are delivered to site and assembled in a matter of days. When the work is completed the total balance of your line of credit will be converted to a standard residential mortgage. You may also find a lender of construction loans for Modular Homes who will agree to include the amount of interest you pay during the construction and cover any cost overruns. On average a modular home only takes 90-days to complete, which reduces interest costs dramatically, compared to a stick built home which can take 12-months or longer.

How Construction Loans for Modular Homes are Disbursed

Funds are distributed when certain work on your property has been completed. For example when the foundation is finished the bank will send someone to inspect the job site to verify the foundation is done. Once verified the bank will distribute funds to either the home owner or contractor. As certain property improvements are completed funds are distributed in a timely manner.

Most lenders will fund the cost of the modular home once it arrives at the home-owners property and is inspected. Funds are allocated to the builder or manufacturer and then the modular home builder will start attaching the home to the foundation. Once this work has been completed funds will be distributed for the installation of the home. If you need to ask for additional money above your original construction loan amount your lender may charge you additional fees.
When talking with a modular home builder, be sure to clarify when funds will be distributed. Many builders and manufacturers require payment once home has arrived to the job site. Some lenders will not fund at this stage of the game and only fund once the home is completely installed. This lending practice is looked down upon in the modular home industry and many builders will not accept this payment method.

Qualifying for Construction Loans for Modular Homes

Like traditional mortgages, construction loans for modular homes will require you to come up with a 10% to 20% down payment. The chances of this will be higher if you are requesting a very large loan, or don't own the lot on which your home will be constructed. The days of 100% financing are long gone since the economic melt-down in September. With any construction loan you should establish a budget and stick with it. Be aware that the temptation to keep asking for extras as your modular home is being designed, can throw your entire budget for the project out of whack and make it more difficult for you to qualify for a construction loan.

Modular Home Rating Guide

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  Home Equity Rate
  Bad Credit Home Loan
  Home Equity Loan
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Useful Articles
How to Borrow Money by Cashing Out Home Equity
Over the years, you have been a faithful steward of your mortgage. But the time may have come when you need to borrow money now for things you need to purchase. A great way to fund your purchases is to cash out the equity in your home with a home equity loan. Read More

Home Equity Loan - Advantages and Disadvantages
A loan taken out for the purpose of transforming the equity in your house into cash that can be used for other purposes is known as a home equity loan. A loan taken with the equity in your home as collateral can be structured in many ways. It is actually a second mortgage in many ways... Read More
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