Once you have a lot picked out, an appraiser will come up with an approximate value for the home to be built. Since the home doesn’t exist yet, obviously this will have to be an estimate. The appraiser will go by recent sales of similar properties in the area as a guide. You can choose the builder. But to protect your interests and ours, NEXA will have to subject the builder to a review including references and public records. You’ll go through the process of getting the loan, which will include both the construction loan and the long-term mortgage, saving you money and effort. The rates are locked at that point, meaning a rise in rates won’t affect your payments. The loan will have a construction term of up to nine months, depending on the type of financing. Once you’ve closed on your loan, construction can begin. As construction proceeds, we’ll release funds to the builder for each phase of the project. During this period of the loan, you pay only the interest on the principal — unless it’s a Veteran’s Administration loan, in which case the builder will pay that interest. (See our section on VA loans for more information.) Once the construction is complete, the loan converts to a conventional mortgage and you make regular payments that reduce the total loan amount. Don’t worry if it seems complicated. A member of our team will be available to advise and assist you through the entire process. If you’d like to learn more about this innovative program and what it can do for you, feel free to contact me any time.