About GMM Loan Programs Loan Officers Office Locations Documents Home This page has been created to outline the consumer construction products offered by George Mason Mortgage, LLC and to provide additional guidance and support to assist customers of George Mason Mortgage, LLC. Borrowers wishing to build a custom home may obtain financing through a package program called Construction/Permanent financing. This program takes a borrower though lot acquisition, construction, and conversion to a permanent loan upon completion of the project. A construction/permanent loan is a one-time close loan program to finance the construction of your dream home, providing both the construction funds and the permanent loan. This means you will save thousands by not having additional closing costs from multiple loan settlements. The normal construction/permanent loan allows for 12 months to complete. Construction extensions are available if necessary. The size of the dwelling and the time of the year are two factors that may effect your construction loan term. Long-term rate protection is available up to 1 year for the customer who is worried about rising interest rates. During the construction period, interest is only charged on the amount of the loan actually outstanding. When the home is completed, the permanent loan period begins. Acquisition/Remodel Loan Program    [ top ] A great loan program if you are buying a home that needs “fixing up” or your client is planning a major remodel to their existing home. This loan finances the purchase or refinance of the home as well as the repairs or remodeling. Just like the Construction to Permanent program, the construction and permanent phases are combined into one loan, saving time and money! The remodel work can take up to 12 months, with draws as frequently as monthly, depending upon the complexity of the project. Once the work is complete, the loan automatically rolls to the permanent loan phase. Home Improvement Loan Program    [ top ] This unique second mortgage program differs from standard home equity loans because our appraisers are giving the client value for the planned improvements. This means more dollars available to finance that new kitchen, bath or addition. Repayment terms to 30 years, with low start rates available. Application Process    [ top ] It will be necessary to make a regular mortgage loan application, just as it is for any residential loan, however, additional information will be needed, such as a lot purchase contract, or proof of ownership if you have already purchased the lot. You will also need to provide the prospective lender with a copy of the construction contract signed by both the borrowers and the builder. This should contain a draw schedule, as well as a bottom line cost of construction. You will also be asked to provide a set of plans and specifications that contain a list of materials to be used in construction, square footage designations, a draw schedule, and a cost breakdown. If all this paper work seems confusing, simply work closely with your custom builder - he or she will understand these requirements and assist in providing the correct documents to your lender. The application process will facilitate a smooth transition to the permanent loan by qualifying the borrower for both the construction loan and the long-term financing at the same time. This process will save the borrower countless dollars by facilitating an on-time closing for both the construction and permanent financing. Documentation Checklist    [ top ] Lot and Project Information Copy of ratified listing, contract and addenda for lot purchase if not currently owned Copy of Deed and HUD-1 for lot if currently owned Two copies of Site Plan and Survey Copy of Plans and Specifications, and completed job cost summary Copy of General Contractor Agreement Personal Information Address for all employers for the last two years Residence address for the last two years, including landlord's name, address, and phone number, if applicable Employment Information Address of present employer and a contact person to whom employment verification may be sent to Written explanation for any job gap during the last two years Relocation letter from employer transferees, including date, salary and relocation benefits If not employed at a current job for two years, provide address, contact person, phone number, working dates, and income range for previous employer Present salary verification; year to date pay stub and last two years W-2's and /or 1099's If any variable income, such as commissions, bonuses, overtime, dividends, is required for qualifying, provide last two years tax returns If self-employed (25% or greater interest), provide last two years corporate tax returns and year-to-date profit and loss statement If a student during the last two years, provide diploma and transcript Additional Income Rental income - provide copy of current one year lease Alimony/child support - provide copy of divorce decree and evidence of 12 months receipt of payments (only if used for qualification) Assets Provide copy of last three months statements for bank/investment accounts Provide copy of stocks or bond certificates Provide copy of title of vehicle if less thank five years old and owned free and clear Liabilities Provide credit card account numbers, balance and payment on all revolving accounts with a balance Provide names of institutions for all installment loans, along with address, account number, balance and payment amount Provide copy of ratified divorce decree for alimony or child support Sale of Present Home Copy of listing and copy of sales contract Construction /Permanent Loans Key Terms    [ top ] Understanding the following key terms can give you a good background as you enter into the custom home financing process. Appraisal - An appraisal will be required as a condition of the loan approval. The appraisal will be done by a qualified, licensed appraiser who will determine the value of the land and the home using the architectural plans and specifications. You will know in advance of construction what the home will be worth upon completion. Builder Draws - As the construction of the home progresses, the builder will require financial draws against the loan. These draws are used to pay subcontractors and other expenses associated with construction. The lender will require an inspection of the project at each draw requests to determine “work completion”, or “work in place”. Mechanic’s Lien Coverage and Title Insurance - Title insurance issued with Mechanic’s Lien coverage will be required on construction/permanent loans in the state of Virginia. In conjunction with each draw of funds by the builder, an interim title search will be conducted to determine that no mechanic’s lien has been filed against your property. Please consult your Title Insurance Company regarding this coverage. Builder’s Risk Insurance - A Builder’s Risk Insurance Policy will be required during construction by the lender. Please consult your Insurance Agent regarding this coverage and its cost. Interest Payments - All payments during the construction phase of your loan will be interest only and calculated off the outstanding loan balance. The payments will be billed monthly, 30 days in arrears. home | about George Mason | loan programs | loan officers | office locations | documents Equal Housing Lender Copyright © 2007, George Mason Mortgage, LLC