If you want to maximize your purchasing power while investing in your custom home build, it’s time to act fast. Interest rates started climbing from their historically low rates, potentially driving up the final price of your new construction project.
However, it’s not too late to lock in a relatively low-interest rate, as the rates still sit far below the record highs of yesteryear.
Ready to get started? Here’s what you need to know.
Mortgage Rates are Bouncing Back Fast
In the past few years, ultra-low 2.67% mortgage rates created a home-buying frenzy across the nation. As homebuyers rushed to take advantage of the rates, real estate prices increased as inventory went on a sharp decline.
While it was a good run, it’s set to end soon, as mortgage rates begin their projected climb past 4%. Local lenders have already seen interest rates anywhere from 4.125% to 5.1%.
With at least three rate hikes expected in 2022, no time is better than now to secure funding for your new construction project.
Why Secure a Low-Interest Rate for Your Mortgage?
You effectively keep more money in your pocket every month when you secure a low-interest rate. As mortgage interest increases, the monthly loan payment climbs as well.
At 3% interest on a 30-year loan, a $500,000 home will cost you about $2,100 per month, barring taxes, insurance, and other fees. A jump to 5.1% interest will increase the payment to over $2,700.
You’ll then be out more than $600 per month that you could have otherwise spent on things you love or invested in your future. So, if you don’t want to throw tons of money at interest every month, act fast to secure the lowest rate possible.
A Look at the Banks Our Clients Trust Most
As your boutique custom home builders, we aim to take the stress out of the equation in every way possible. We regularly work with banks known to meet our commitment to providing a positive, stress-free experience.
Our trusted banking partners include:
GMFS Mortgage
GMFS Mortgage has served as a five-star lender since 1999, helping more than 140,000 customers secure funding for their dream homes. They mainly operate in the southern U.S., with main offices in Baton Rouge, Louisiana.
They understand the challenges of building in the greater Tangipahoa Parish area. They offer monthly extensions, making them excellent for 100% unique new construction builds.
First Bank & Trust
Since its inception, First Bank & Trust has provided clients with innovative financial solutions backed by expert guidance. They’re based out of New Orleans, giving them a unique perspective on what it takes to build custom homes in south Louisiana.
While they often have higher interest rates, their generous 15-month extension policy serves as a true asset in the home building process. On top of that, they’re always happy to collaborate with clients and contractors alike.
Gulf Coast Bank
Another fantastic southern U.S. lender, Gulf Coast Bank, is the perfect middle-of-the-road option. Their interest rates and down payment are average, but they do offer a one-time closing.
They’ve proudly served clients in Baton Rouge, New Orleans, and the surrounding area since 1883. Their local roots ensure they always understand when delays occur, allowing you to get a 14-month extension quite efficiently.
Not all construction lenders offer the same products. You need to shop around to get the best rates.
Even if you’re already pre-approved, reach out to at least a couple more lenders to see what they can offer. Unless you apply, you won’t know if they’ll offer lower interest rates or other favorable terms.
Just remember to look beyond interest rates. Find a lender offering a one-time closing as well.
Get Help from Your Trusted Custom Home Builders
Are you ready to secure funding from construction lenders for your new home build? Get the support you need from our team at eNg Designs & Construction.
Call us at 985-662-5394. We are always here to help you on your journey toward building your dream home.
