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Building And Remodeling Loan


There is nothing more fun when building a house to see all your dreams become a reality. Whether you love your home but you need to remodel a little bit, or if you want a totally brand new house designed to fit your needs and wants, you could really benefit from a building and remodeling loan. You could get a HUD loan, get a second lien on your current home, get a bridging loan from a builder, or get a cash out home equity mortgage refinance. There are a lot of options out there for you, so do some research to see which one would be the very best. 


Getting a bridging loan might be the way for you to go, because the builder might finance the house through the construction and then you can finance it when it is finished. It is a temporary loan and you can get it through your local bank or credit union. You will end up with two loans in the end; the bridge loan and the permanent loan, but it will help you through the building process. 


There are some loans that will pay for the construction as you are doing it and then will add the remainder of the loan when you pay closing costs on the house after it is finished, paying interest only on what was funded before you reached closing. This is one of the most popular ways to fund a newly built home and is a great option for someone who needs a new home loan. 


If the home you purchase is in need of a remodel when you purchase it, you might be able to get HUD financing that will allow extra loan money to pay for the repairs. This would be a great way to go because the money will be included in the total amount of the loan, so that the amount you are quoted will already have that factored in. If you are worried because your credit score is not very great, the FHA has bad credit mortgage loans that are available for people who need to do some remodeling that have poor credit. 


Deciding if you need a conventional loan, a bridging loan, or to do mortgage refinancing might be a hard decision, but you can always talk to a loan officer so that you can see what your options are and be able to make the best choice for you in your particular situation.