Financing in Atlanta>Question Details

Sadina, Home Owner in 30052

is the construction to permanent loans for expanding your home? I would like to expand and upgrade my home.

Asked by Sadina, 30052 Fri Aug 2, 2013

Help the community by answering this question:


Javier, we have no equity because of the house market. We currently have a usda loan which we just refinanced. Our payment is super low, 800/month. We would like to add anithwr matter bed and bath, the one we have is tiny. Upgrade kitchen, take out carpet in bedrooms, replace work pergo or something equally durable with my 5 kids, and replace siding. We have great credit, but some debt about 35 back ration for what we have compared to what we make. So how does a loan like that work?
1 vote Thank Flag Link Fri Aug 2, 2013
Actually there are lenders that will allow construction to permanent loans for renovations. Mine is one of them. You will need at least 20% equity based on acquisition cost (if owned for less than 12 months) or appraised value (if owned for more than 12 months) plus construction costs. Feel fre to give me a call to discuss in greater detail.


Chris Irvin
Mortgage Banker
Brand Mortgage
NMLS # 75615/465546
0 votes Thank Flag Link Tue Aug 6, 2013
A Construciton/Perm loan is typcially for brand new construction. What you are referring to is a Renovation motgage. The most common type of this laon if hte FHA 203(k). In order to do the 203(k), you will need to have around 10% equity in the property. Unless, you have that much equity "As Is", then you would not be able to finance in your closing costs/pre-paids.

As one of the largest direct lenders in the country, Prospect Mortgage offers one of the largest selections of loan programs available. In addition to the standard conventional, FHA, VA, USDA, and Jumbo, we also offer a wide range on Renovation loan programs. Our Renovation programs include FHA 203(k) (Streamline & Consultant versions), HomePath Renovation, and HomeStyle Renovation.

For the FHA 203(k) program, some lenders only offer the Streamline FHA 203(k). That does not give you any options should you encounter the need for the Consultant version for structural repairs or if you are looking for renovations in excess of the Streamline’s $35,000 limitation. Working with a direct lender who offers bother the Streamline and Consultant versions is very important.

For HUD’s Fiscal Year ending 09/30/12, Prospect Mortgage was the 2nd largest volume FHA 203(k) lender in both the country and the Metro Atlanta market. At Prospect Mortgage, we have a dedicated operations center that only handles our renovation mortgages.

Selecting a loan officer that knows the program inside and out is the key. If your loan officer is not experienced in closing a lot of these types of mortgages, then it will be a very challenging experience for you. Allow an average of 45-60 days for your 203(k) closing. Prepared buyers are often able to close sooner than that. Some have closed in under 30 days when they are very prepared.

All renovation work will need to be completed by a licensed and insured contractor. I have heard that some lenders may require the use of certain contractors. At Prospect Mortgage, you are free to use any contractor that you wish that meets the minimum requirements as we do not maintain any type of approved contractor list or provide contractor recommendations.

Other than for appliances in certain situations, you may not use any of the big box retailers (i.e. Best Buy, Home Depot, Lowe’s, etc). This is because they will not sign any of the HUD required 203(k) contractor forms.

Use of a HUD Consultant is required on the Consultant FHA 203(k) and highly suggested on the Streamline version.

Working with a knowledgeable and seasoned loan officer is critical in today's market. Getting Pre-Qualified is the only way for you to find out your options. To get Pre-Qualified for your purchase, you can submit your request online at

Rodney Mason, NMLS #151088
Sr Loan Officer
Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
Apply Online at
Licensed in Alabama & Georgia with over a decade of mortgage lending experience.

Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203K Renovation (Streamline & Consultant) | HomePath® | HomePath® Renovation | HomeStyle® Renovation | VA | USDA | GA Dream | Jumbo Financing.
0 votes Thank Flag Link Sat Aug 3, 2013
Actually construction permanents can be used for the purposes you mentioned, but require a minimum abounds of equity, at least 20%. Seek out someone able to do a 203k loan.
0 votes Thank Flag Link Sat Aug 3, 2013
Construction to permanent is a loan for new constructions. What you're talking about is a 203(k) loan. You're able to refinance your home and incorporate the cost of upgrades.

Consider meeting with a 203(k) experienced Loan Officer. I'm always available to help if you need an experienced and reliable Loan Officer. Good luck!

If my response was helpful, consider clicking BEST ANSWER!

Javier Meneses
Senior Loan Officer
NMLS #23130
310 Crossways Park Drive
Woodbury, NY 11797
(516) 606-9648 Cell
(516) 740-4478 Office
(516) 918-5383 Fax
0 votes Thank Flag Link Fri Aug 2, 2013
Possibly, it depends on the degree of improvements you want to do and if you have construction experience. If you are planning a major renovation, a construction permanent might be ideal. These loans are complicated and not many lenders do them. Feel free to contact me directly, I'm certified by SunTrust as a specialist with these loans. I'd be honored to assist you.

Thank you,
Nick Nicholas
SunTrust Mortgage
0 votes Thank Flag Link Fri Aug 2, 2013
A construction to permanent loan is for new construction only. I think you need to look into a home equity line to make any upgrades you are interested in, but it's best to speak with a lender to determine the right product for you.

Ava Anderson
Solid Source Realty Inc
770 369-5121
0 votes Thank Flag Link Fri Aug 2, 2013
I think that is for new construction only, I think an equity line would be what you would need to check out. Contact your local BB&T Bank. They can guide you.
0 votes Thank Flag Link Fri Aug 2, 2013
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