Adjustable rate mortgages

Finally, because home building loans are not permanent mortgages, determining how to finance the home once the construction is complete will be need to be done. There are a number of approaches people use to convert home building loans to permanent ones. A conventional route would be to shop for a permanent mortgage at various banks, finding the best rate and terms available. The mortgage lender will need to know that the home is currently being built and that there's a wish to convert to a permanent mortgage upon completion of construction. Another approach to is to secure a double loan, which is a home building loan that automatically converts to a permanent one once construction is complete. This saves time and the dollars associated with closing two separate deals. If the home is being built as an investment, consideration of converting to an ARM (adjustable rate mortgage) may be a better solution..