Sunday, January 01, 2006
Log Home Finance Search
There are many companies and banks that do construction lending. In fact my company is wholly owned by a small town bank so we know both the bank side and the mortgage only side of this business very well. What you may not realize is there are only about 4 companies that will do a log home construction loan.
"Why wouldn't they finance a log home?" you ask? Great Question!
When you have a log home, underwriters and banks call them "unique" even though they have doors, windows and a ceiling just like "stick built" homes do. Unique because there are no identical homes on identical lots within 5 miles that have sold in the previous 6 to 12 months. That is the FANNIE MAE standard definition for a "comparable home" for the purpose of appraisal and underwriting.
Of course the mystique of the log home made you want it. Unfortunately that same good quality we like eliminates all the other major players in the lending business.
Of the remaining 5 companies that welcome log home construction, we work with ALL of them. Only two of those will do log construction without having any similar homes to compare to. I do loans from both of those companies.
Right now I'm doing a log home construction loan for a self-employed borrower. There are no log homes within 30 miles of his location yet I was able to get it approved. His end rate will be 6.625%! It can be done!
With that said, please allow 60-90 days prior to when you intend to start construction to begin your loan process. We can get these deals done in 13 days if we have to, and I have one of those right now that we are racing to complete.
"Why wouldn't they finance a log home?" you ask? Great Question!
When you have a log home, underwriters and banks call them "unique" even though they have doors, windows and a ceiling just like "stick built" homes do. Unique because there are no identical homes on identical lots within 5 miles that have sold in the previous 6 to 12 months. That is the FANNIE MAE standard definition for a "comparable home" for the purpose of appraisal and underwriting.
Of course the mystique of the log home made you want it. Unfortunately that same good quality we like eliminates all the other major players in the lending business.
Of the remaining 5 companies that welcome log home construction, we work with ALL of them. Only two of those will do log construction without having any similar homes to compare to. I do loans from both of those companies.
Right now I'm doing a log home construction loan for a self-employed borrower. There are no log homes within 30 miles of his location yet I was able to get it approved. His end rate will be 6.625%! It can be done!
With that said, please allow 60-90 days prior to when you intend to start construction to begin your loan process. We can get these deals done in 13 days if we have to, and I have one of those right now that we are racing to complete.
Conforming Lending On Log Home Construction
Most banks tell you that "because there are no log home comparables we can't do this loan..."
I can. I don't need exact log home comparables
This is what I do. Email me daved_nash@yahoo.com and I will be glad to help.
Tuesday, December 20, 2005
Log Kit Disaster
I came across a site with the info needed to build your own home and how to use tools "that fit in your trunk... and get the logs for $100 bucks..."
Ok, so they have no ulterior motives for telling you this.
My market is the guy with the good scores and deep down John Denver streak for nature who wants a log-mansion.
GRIZZLY ADAMS WITH BEN
If you are more of the Grizzly Adams type with a few tools and some time: order the logs and stack them yourself. People have done it successfully and made money on the project.
The downside is you don't have some of the expertise you get with a Heritage Log or Jim Barna company in treating the logs and prepping the package. The upside is you own it free and clear with your sweat equity.
Ok, so they have no ulterior motives for telling you this.
My market is the guy with the good scores and deep down John Denver streak for nature who wants a log-mansion.
GRIZZLY ADAMS WITH BEN
If you are more of the Grizzly Adams type with a few tools and some time: order the logs and stack them yourself. People have done it successfully and made money on the project.
The downside is you don't have some of the expertise you get with a Heritage Log or Jim Barna company in treating the logs and prepping the package. The upside is you own it free and clear with your sweat equity.
What is Dry-In?
Simple: all the doors, windows, roof on the stacked logs.
Dry in is when the interior can be protected from the rain.
Dry in is when the interior can be protected from the rain.
Log Or Post & Beam?
Sure. We finance either one or both or hybrids.
Best of Both Worlds...
If you don't know what a post and beam home is, here is a google result for the "Billy Joel Glass Houses" cover:
In short, a lot of glass, exposed timbers that are huge, and some "normal" drywall inside.
Most of your "modern Log mansions" are hybrids of post-and beam and Log construction. There are log-home-purist-naysayers out there who decry the combination being called a log home. I say if it's made out of logs it's a log home!
Best of Both Worlds...
If you don't know what a post and beam home is, here is a google result for the "Billy Joel Glass Houses" cover:
In short, a lot of glass, exposed timbers that are huge, and some "normal" drywall inside.
Most of your "modern Log mansions" are hybrids of post-and beam and Log construction. There are log-home-purist-naysayers out there who decry the combination being called a log home. I say if it's made out of logs it's a log home!
Monday, November 07, 2005
Self-Contracted Log Home Kit
So you want to build it yourself just like Grizzly Adams? Sure, you can.
My first question back is this: ever done log before?
My second question: do you have a full time job?
If you answer no/yes then you may not want to try to tackle this yourself. It is easy if you know what you are doing. If you don't know and you try it you might spend a TON of money fixing problems.
If you can answer yes/no(i.e.:I'm a general contractor who knows how to do it) then go for it!
My lenders want it done within a set time frame, usually 11 months maximum. Not 11 months from when you break ground, but 11 months from when you sign your loan documents.
Also my lenders will want some kind of proof of ability. As an alternative, you can hire a consultant for a fee and pay him to pick his brain. Consultants range from daily on site to never there only answer cell phone questions.
My brother-in-law built his own lakeside 2nd log home kit on the weekends. An 1000 sq-ft kit took him 18 months with his full time job. Some of the timbers in the bottom of the stack had to be replaced because they sat on the ground so long. Not from rot, but from staining. He swears he'll never do that again.
He did save some money-but he will tell you he didn't save much. He also knew what he was doing and still says it was something he won't repeat. It cost him a ton of time to get it done. In hindsight, it would have been cheaper in his time cost to pay someone who knows what they are doing. We have horror stories here of cut logs (you don't cut anything, the pre-cut kits have to be stacked in a specific order and if you cut something you have messed up!) and ruined kits... you need to know you can do it to finish no matter what.
I'll be happy to get the money for you, I'm just giving you fair warning!
Log Home, How Much Cash Down?
Well, in the systems built world you will always want to have cash down to secure your package from the manufacturer.
On my end, most people qualify for 95% of appraised value! That means that 99% of the time you only need to have some closing costs and final inspection money.
Email me with any questions!
daved_nash@yahoo.com
On my end, most people qualify for 95% of appraised value! That means that 99% of the time you only need to have some closing costs and final inspection money.
Email me with any questions!
daved_nash@yahoo.com
