CONTRUCTION LOANS
What you need to know.
- After the interest only construction phase, your loan will roll right into permanent financing - you only have one closing, saving you time and money!
- At Ozarks Federal we will work directly with you and your contractor to disburse the funds for your construction phase. Invoices are paid by check or can be electronically deposited into your account within 1 - 2 business days - we do not use a voucher system.
- Your loan officer will do periodic progress inspections during the construction phase.
- At the end of the construction period, borrowers may be provided with a print out of all payouts and copies of all lien waivers upon request.
- The equity in your lot or land can be used toward your down payment.
- Borrowers may operate as their own general contractors - qualifications may be required.
- A cost estimate breakdown and set of house plans we can share with an appraiser will be required.
- Borrowers that will be using a General Contractor must have a written contract with the General Contractor. The contract must contain verbiage that states, "The General Contractor assumes all liability for damages or deficient or incomplete work provided by sub-contractors."
- Major material purchases can be paid from invoices or quotes provided by the lumber yards or retailers. No advances will be paid to the borrower for the purchase of materials or labor.
- A deposit account with Ozarks Federal must be established for reimbursements of paid invoices directly by the borrower.
- We will collect lien waivers for your convenience and protection. Lien waivers will be required for all labor that is paid by the borrower or by Ozarks Federal.
- If a sub-contractor submits an invoice for labor and material, We will require a lien waiver for the material unless it is out of that sub-contractors own stock,or Ozarks Federal can pay that material bill separately.
- A W-9 form must be completed by all un-incorporated businesses or individuals who are paid through the construction loan. Each year, Ozarks Federal will report these payments to the IRS as income.
- A completed W-9 form must be submitted before payment can be released. Ozarks Federal has an extensive list of sub-contractors who already have W-9s on file with us!
- Any changes from your original construction plans or cost estimate must be discussed your loan officer and General Contractor. Significant changes may require approval from our Loan Committee and may require a re-inspection by the original appraiser.
The Importance of Vetting YOUR General Contractor
- Make sure you check their credentials before you hire them!
- Choosing a General Contractor is like any other type of professional you would hire. Consider the folloiwng things when you interview a General Contractor for your home:
- Does the General Contractor:
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Have proven experience in building the type of residence you want?
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Meet state licensure and insurance requirements?
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Have a good reputation in the community?
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Have a good rating with the Better Business Bureau?
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Have excellent references from past clients and suppliers?
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Have a permanent business address?
Apply Now and let us help you build the home of your dreams!