Credit? "Approved." Appraisal? "Approved." Loan? "Approved." Closing? "Seven more days!"
Yes, regardless of what you may think, it takes money to build a house. Unless you're lucky enough to cover the costs of home construction with the receipts in your wallet, start shopping for a lender.
I started shopping three months ago. My goal was to find a local financial institution interested in something new, not just standard construction. This made it a little difficult because passive house construction is far beyond the standard construction concepts US lenders are familiar with. I felt like I could make it easier for the next passive house homeowner in southwestern VA if I could find a lender that was open to the idea and willing to finance our construction.
To be honest, the rates are great, but the banks don't want to fork out the dough. There's not a lot of lenders out there willing to finance more than 75% of the construction expenses and there's not a lot of consumers out there that are prepared to fork out 25% of their own money to build a house either. As I worked through the first loan application, then the second and third, I wasn't sure I was going to find anyone to offer me something I could work with until Adam called. All he said was, "I think I've found someone, call StellarOne."
I picked up the phone, called a Senior Mortgage Consultant at StellarOne, made the initial inquiry and hung up the phone. Within a day I had submitted my personal information, the details of our passive house and my application was rolling. Without a doubt, StellarOne made the application process effortless.
Sure, there's been some challenges and nail biting over the last 30-40 days but the results of our appraisal cooled my nerves. The appraisal was our the biggest concern and the results were reassuring; the comparable properties listed in the appraisal justified the added 10% cost of building a passive house and even a little extra.
So why not build a passive house, its obviously worth it?
Following the completion of the appraisal, my application was submitted to the underwriting team at StellarOne and conditional loan approval was granted.
From here, the final step was to seek out builders risk insurance. Five calls to different insurance agents and I'm done. The best price, the best coverage, and the best customer service; its not that hard. Now, we sit tight and wait for Monday. Keep your fingers crossed!
Smooth sailing; I know I said it before but cheers again to StellarOne for making this process as smooth as possible. After I get permission, I'll be sure to throw the Senior Mortgage Consultants name out there for your reference.