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FAQ

Is CLC just a construction lender?
Why should I choose CLC’s construction/mortgage financing program?
What payments will I be required to make during construction?
How can I best estimate the total cost of my project?
Do I need a Builder’s License to build my own home?
What is a draw?
What if I own a home now and it hasn’t sold yet, but I want to start building now?
What if I still owe money on my land?
How is CLC affiliated with Credit Unions?
Does CLC offer home building assistance?
How do I submit a draw request?
How many draws will I be limited to for my project?
Where will my draw funds be disbursed?
Does CLC finance projects out of Michigan?
What does a one-time closing program mean?
How much of a down payment will I need to begin construction?
Does CLC finance modular, log or post and beam homes?
When should I inform you of any changes on my project?
Can I take a draw to pay for deposits on materials/supplies?
When can I convert into my permanent financing?
What does turnkey mean?
What if I don’t need to borrow as much as I thought for my permanent financing?
I have more questions, how do I contact CLC?

Q. Is CLC just a construction lender?
A. No, CLC is a full service mortgage lender financing all types of mortgages, construction loans, home improvement loans, vacant land loans and bridge loans. CLC can finance both the interim construction loan and permanent mortgage (may vary depending upon state location) for your project and you only apply once! CLC also finances many home purchase and refinance mortgages. If you need assistance building your home let us know. Depending upon your project location, our affiliate company, Pro-Built Homes may be able to help!

Q. Why should I choose CLC’s construction/mortgage financing program?
A. Financing new home construction or home improvement projects is CLC’s specialty. When you are building or remodeling your home, you don’t need just a mortgage, you need a construction mortgage that works for you and not against you! CLC’s program is structured to assist individuals interested in general contracting his/her own home (without having a building license) or for those that hire a builder to construct the entire home. Either way, CLC’s staff is knowledgeable and experienced in construction lending and understands the draw process needed during construction. We offer a licensed builder on staff that can assist you with questions or concerns during the construction stage, as well, as help you in bidding your home for the do-it-yourself person. CLC offers an industry, unique program for owner-contractor and builder projects because of a one-closing loan option. CLC is more than just a lender; we are a full service, experienced construction lender!

Q. What payments will I be required to make during construction?
A. You will receive a monthly billing statement based on the amount drawn from your construction loan. You will be required to make an “interest only” payment based on the outstanding balance drawn from your construction loan, not the full loan amount. In most cases, your interest only payments are due by the 15th of each month. Upon closing of your loan, CLC will assist you in setting up automatic payment deduction and payments will be automatically debited from your checking account. If you select the Homestyle Renovation mortgage, you will be required to make principal and interest payments on the full mortgage amount. Payments terms vary depending upon the program you choose, contact CLC for more information.

Q. How can I best estimate the total cost of my project?
A. Use a detailed project cost estimate sheet to make sure you have accounted for all necessary supplies, materials and labor costs. It is recommended that you get three bids for every item. If you are hiring a builder to construct your home, you should have a detailed building contract that outlines the total cost of the home with specifications, as well as, a detailed list and total of all allowances. [Click here for a copy - PDF - Microsoft Excel] of CLC’s project cost estimate sheet.

Q. Do I need a Builder’s License to build my own home?
A. No, a Builder’s License is not required to build your own home with CLC’s financing program. You may act as your own general contractor and take on the responsibility of constructing the home, yourself. Responsibilities include, but are not limited to, hiring your own subcontractors, ordering materials and supplies, scheduling all subcontractors and material/supply deliveries, arranging payments terms with suppliers, laborers, subcontractors, submitting draw requests, completing the Sworn Statement and Lien Waivers and managing the project’s budget and expenses. For more information, contact CLC for our Owner-Contractor Guide.

Q. What is a draw?
A. A draw is taking funds from your construction loan to pay for costs during construction. A construction loan works similar to a line of credit where you may request draws to pay for materials supplies and labor during construction.

Q. What if I own a home now and it hasn’t sold yet, but I want to start building now?
A. In most cases, the sale of your current home is not required to begin construction of your new home. A CLC Loan Consultant will review options with you when applying for your construction permanent loan.

Q. What if I still owe money on my land?
A. The first draw of the construction loan is used to payoff the balance due on your land. CLC will assist you in budgeting a construction loan amount to cover the remaining cost of construction or any down payment needed.

Q. How is CLC affiliated with Credit Unions?
A. CLC has partnered with many Credit Unions in providing construction loans, construction loan management and funding programs. CLC also has a subsidiary company called Member Home Lending Services, Inc., (MHLS). MHLS provides full service mortgage programs for Credit Unions and Credit Union members by offering a variety of mortgages for home purchases and refinances. Credit Union membership is not required to apply for a loan with CLC.

Q. Does CLC offer home building assistance?
A. Yes, CLC can assist you with general questions about your building or remodeling project. If you are looking to hire a builder to construct your home or if you are interested in hiring a project manager (or consultant) contact our affiliate company, Pro-Built Homes.

Q. How do I submit a draw request?
A. Draw requests will be submitted through a local title company using a Sworn Statement and Lien Waivers. The amount “currently owing” on the Sworn Statement should be equal to the amount of the draw you are requesting. Sample Sworn Statement (PDF) and Draw Request Forms are available. If you hire a licensed builder for your project, the builder most likely will be responsible to submit draw requests and collect lien waivers for the draws.

Q. How many draws will I be limited to for my project?
A. CLC offers many construction financing programs. The number of permitted draws depends upon the program you choose, the type of home you are building, and/or what construction program you qualify for. In most cases a 5-6 draw program is acceptable; however, CLC does also offer a construction program with unlimited draws. A CLC Loan Consultant can discuss the advantages of the different programs and help you determine which is best for your project.

Q. Where will my draw funds be disbursed?
A. Draw funds are typically disbursed directly to the borrower’s checking account, to the builder and borrower, or directly to subcontractors. Disbursement options will depend upon what the draw/advance is for, as well as, program guidelines.

Q. Does CLC finance projects out of Michigan?
A. Yes, CLC finances many construction projects in different states. Contact us for more details.

Q. What does a one-time closing program mean?
A. A one-time closing program means your construction loan and mortgage are combined into one loan. You have only one closing and pay one set of fees.

Q. How much of a down payment will I need to begin construction?
A. The required down payment is based on the program you choose and qualify for. CLC offers a construction loan program based on no money down (with two separate closings) and a Construction-To-Permanent mortgage (minimum 5% down based on the cost of the project). In some cases, if you have owned your land over 12 months and/or have some land equity, no additional funds or down payment may be needed for the Construction-To-Permanent mortgage.

Q. Does CLC finance modular, log or post and beam homes?
A. Yes, CLC finances all types of homes including modular, manufactured, traditional stick built, log homes, panelized or post and beam homes.

Q. When should I inform you of any changes on my project?
A. Any project changes should be reported to CLC’s construction loan department immediately.

Q. Can I take a draw to pay for deposits on materials/supplies?
A. Yes, CLC’s financing program is flexible. You may take a draw from your construction loan to pay the deposits needed for builders or for special order materials/supplies, as long as, these items have been budgeted into your construction loan.

Q. When can I convert into my permanent financing?
A. When you make your final draw request the following information is needed to convert your construction loan into permanent financing.

1. Notice of Completion (per satisfactory final inspection and certificate of occupancy).
2. Satisfactory pay history on construction loan.
3. All appropriate Lien Waivers completed and signed.
4. Borrower documents (depending upon the loan you have been approved for updated pay stubs, checking/savings statements, etc., may be needed).
5. Final endorsement from title company.
6. Paid and/or current homeowners insurance policy and property taxes.
7. Approved loan balance. (construction loan balance has not exceeded original approved construction loan.)

Q. What if I don’t need to borrow as much as I thought for my permanent financing?
A. In the event your outstanding construction loan is less than what you have been approved for or if you have additional money available to buy down your loan balance, this is re-calculated at the time of rollover to your permanent financing. Your permanent financing will be lowered to the appropriate amount and your new principal and interest payments will be calculated accordingly.

Q. What does turn-key mean?
A. A turn-key transaction is simply buying a newly constructed home direct from the builder. You purchase the home in completed condition and attain a home purchase mortgage instead of a construction loan and mortgage. CLC offers mortgages for turn-key transactions.

Q. I have more questions, how do I contact CLC?
A. You may contact CLC via email, phone or mail.