what are my loan options?

jbone · Joined: 27 Jul 2005 Posts: 2 Location: crete, illinois

My wife and I are interested in building a new home and selling the home we currently have. Our problem is that all of our money is tied up in our current house and I do not have a down payment to get the new one started so it will be done before the end of the year.

I have about 40,000.00 in equity in my home now and I need 20,000.00 to start building the new house. Should i get a home equity loan? Should I wait until I sell my home and then start building, which would mean it probably won't get done till next year (can't build in the winter). My builder said he could only hold my price for this year and he is already advertising the same house i want to build for 15000.00 more and it could possibly be more next year, also I am worried about interest rates rising.

My credit score is 695 and my wife's is 685 and I don't know what other options I have. I would like to get this thing going as soon as possible. Thanks for any help

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

jbone:

There are a few options that you have available. You could look at an equity line/loan if you wanted to have the flexibility to pull out the money you want out for when you need it. If the payments are a concern for you, you can look at a bridge loan. A bridge loan would be an interest only loan that you could use to pay off your current loan to keep your payments low. Generally there is an up-front cost for something like this however, so it's questionable how much sense this would make.

As far as a concern for rates, there are extended locks available. I can only speak from our perspective at Wells but we can lock up to 360 days. If you're building, obviously this is something that can be important.

I'm down state from you here in Springfield, but if you'd like we can discuss some of this further.

jbone · Joined: 27 Jul 2005 Posts: 2 Location: crete, illinois

Thanks for the reply, i would like to talk to you about my options, and my current loan is through Wells Fargo so that might make things easier. Do you have a number where i can reach you? And could I call you sometime this evening or one evening this week, I am also off of work on friday so anytime that day is fine. thanks

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Jbone,

My number is 217-553-6494 or 800-420-0053x122. Give me a call anytime, although parts of this evening I will be unavailable (moving drywall for a buddy.)