Question : Can you refinance a interest only construction loan prior to converting to conventional?
My wife and I recently moved into a new home which we are still paying interest only on the loan. We also just sold our other home and would like to put the money we made off of it down on the loan. Can we put the money down when we convert or do we have to refinance?
- asked by Timothy M
All Answers:
Answer #1
I assume when you say "converting to conventional"that you have a construction loan product thatautomatically converts to conventional financingwhen the construction phase is completed. Withoutreading the terms of your loan, it's hard to know. Some loans have prepayment penalties. Read yourloan documents or ask the lender directly, andmake sure it is in writing.I used a constructionloan to purchase and rehab an investment property,where the bank would convert to conventionalfinancing. I could pay any amount towardprincipal at any time, but every loan isdifferent.
- answered by AllCourt
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