Using a Construction Company’s Lender for New Construction Mortgage

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When to Use a New Construction Company’s Lender for a New Construction Mortgage

For some reason, many home buyers see buying a newly constructed home as an entirely separate real estate transaction where the traditional rules don’t apply, and everything is as simple as buying a loaf of bread at the store. Sadly, that is not the case, and more consumers are finding out that a new construction home is every bit as complicated as a resale.

Builders have quickly become some of the largest companies in the United States and they have done so on the backs of rapid growth in many areas of the country new construction mortgage | new construction lender as well as the increasingly customary practice of constructing entire communities instead of simply a row or two of homes.

More Money, More Problems
This rise in popularity has given builders a large amount of financial clout and a more complicated financial situation to boot as many are now publicly traded companies with shareholders, public perception, and employees to keep happy all at the same time. To fatten the bottom line, which usually solves all three of those problems, many have turned to partner with lenders they are either closely allied with or own outright.

Simply put, selling homes is just one part of the business model of today’s builder and while part may be dedicated to building commercial infrastructure into communities to reap greater profits, part is certainly dedicated to getting increasingly involved in the loan you take out on their new home.

The Big Catch
Many home builders will offer you an attractive set of perks to go with their financing options and all of those perks hinge on the catch that you use a specific lender outlined by the builder in advance to handle all of your financial dealings. When it comes to home ownership, that can amount to a pretty penny in interest payments and closing fees, giving those lenders a lot of wiggle room to use to create incentives for builders to recommend Joe’s Lending Agency.

Of course, when there is no competition for business and new builders are funneling clients into a particular lending agency, there is little push within that lending agency to offer rates lower than the competitors. As is often the case, by limiting yourself to a single lending option, you will end up seeing a higher interest rate and you will have no recourse available.

Sometimes, You Have to Play Hardball
While these financial agreements support the bottom line of many mainstream home builders, they are not the core business aim and if you threaten to take your business away, you can still be successful in removing restrictions on what lender you can use. Remember, you have the ultimate power to say yes or no to buying a home and that is extremely powerful.

If the final hurdle between getting you to purchase a $300,000 home and walking away is being able to use your lender, nine times out of 10 the builder will let you use your lender for fear of losing the sale altogether. The power of walking away is extremely potent when it comes down to these situations, but you have to make your stand well before signing on the dotted line. Once the contract is signed, your options dwindle.

A real estate agent can often be your best friend in these situations as they will have seen numerous new home builders try the same tricks of the trade. Don’t be intimidated by the fact that you are dealing with a large corporation and don’t think for a second that there is only one home out there. Shop around for your real estate, do your homework, and before you ever put pen to paper, get your lender on the deal. You’ll thank yourself later.

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About Tri-Cities Washington
Tri-Cities is a region in Washington state that includes the cities of Kennewick, Pasco, and Richland. These cities are located in the southeastern part of the state, along the Columbia River. The Tri-Cities area is known for its warm, dry climate, and is a popular destination for outdoor activities such as boating, fishing, and hiking. The region is also home to a number of wineries and is a major producer of wine in Washington state.
What are the major cities in and around Tri-Cities Washington?
Tri-Cities is made up of the cities of Kennewick, Pasco, and Richland. Other major cities in the surrounding area include Yakima, Walla Walla, and Spokane. These cities are all located in eastern Washington state.
The benefits of purchasing a Tri-Cities Washington home.
There are many benefits to purchasing a home, including the potential for building equity, having a sense of stability and ownership, and being able to make decisions about your living space. Additionally, mortgage interest payments on a home can often be tax-deductible, which can save you money on your taxes. Owning a home can also provide a sense of accomplishment and pride.
When is a good time to purchase a Tri-Cities Washington home?
The best time to purchase a home will depend on a variety of factors, including market conditions, the state of the economy, and your own personal financial situation. In general, it may be a good idea to wait until you have saved up a sufficient down payment, have a stable job and income, and have a good credit score. It can also be helpful to wait until the housing market is favorable, with low interest rates and affordable home prices. Ultimately, the decision to buy a home is a personal one and will depend on your individual circumstances.
What is Tri-Cities Washington real estate investing?
Real estate investing involves the purchase, ownership, management, and sale of real estate for profit. This can be done through a variety of means, including the purchase of residential or commercial property, land, or investment in real estate investment trusts (REITs). Real estate investors typically aim to generate a return on their investment through rental income, the sale of the property, or both. Real estate investing can be a lucrative way to generate income, but it also involves significant risk and requires careful planning and management.
Should I use a Tri-Cities Washington real estate agent?
Whether or not to use a real estate agent is ultimately a personal decision. A real estate agent can provide valuable expertise and guidance throughout the process of buying or selling a home, but they can also add additional costs. If you are unsure whether to use a real estate agent, it may be helpful to consider your own knowledge and experience with the real estate market, as well as your comfort level with navigating the process on your own. It can also be helpful to weigh the potential benefits and drawbacks of using an agent, and to talk to other people who have recently bought or sold a home to get their perspective.