Step By Step Guide for Construction to Permanent Financing

Step 1 - Initial Discussion

During your first meeting/phone call with us, we will help identify the best solution for your new home lending needs. This introductory meeting will provide an understanding of your desired project, including the expected lot and construction budget.

Step 2 - Apply for Financing

The loan application can be done in person, or simply by visiting www.sandyspringbank.com. If applying online click the “apply now” button. After your application is submitted, we will provide preliminary loan disclosures, as well as, a list of supporting documents needed to obtain loan approval.

Step 3 - Submit your Contract

Once you have agreed upon the terms with your builder, you will need to supply us with a copy of the contract for loan underwriting. Your builder may require a deposit at the time of contract signing to assist with items needed to start the project, such as design work and permits.

Step 4 - Loan Underwriting

With receipt of your supporting financial documentation and a copy of your contract, your loan request will be submitted for approval. The underwriter may request additional information or clarification on the information you’ve provided.

Step 5 - Appraisal

Once all documents are received, an appraisal will be ordered. The appraiser will provide both an estimate of current land value, as well as, the finished value based on your plans and specs.

Step 6 - Loan Closing

Upon final loan approval, we will schedule your loan closing. At this time, you will be required to bring your down payment (less the deposit already paid to your builder) and closing costs. You will obtain ownership of the property and can begin construction of your new home!

Step 7 - Construction Phase

Prior to closing, you will receive a draw schedule identifying when payments will be made to the builder throughout construction. Your loan payment each month will be based on the amount drawn on your loan to date.

Step 8 - Permanent Financing

Prior to completion, we will contact you to discuss your permanent loan options. Sandy Spring Bank offers a One Time Close construction loan which provides the flexibility of closing once for both your construction and permanent financing. The interest rates for both construction and permanent loan are locked at the same time.

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