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Applying for home loan why do they ask about construction



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amother
OP


 

Post Fri, Sep 25 2020, 2:41 pm
I’m in the middle of construction but I didn’t get a permit.. what should I check yes or no.
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Amarante




 
 
    
 

Post Fri, Sep 25 2020, 2:54 pm
I am confused. Are you building a house without getting permits?

The lender is concerned that a house is built legally because if you build without a permit the jurisdiction can halt construction and even order whatever has been built to be demolished. The lender would then lose the collateral and the mortgage would be worthless.
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amother
OP


 

Post Fri, Sep 25 2020, 3:25 pm
Amarante wrote:
I am confused. Are you building a house without getting permits?

The lender is concerned that a house is built legally because if you build without a permit the jurisdiction can halt construction and even order whatever has been built to be demolished. The lender would then lose the collateral and the mortgage would be worthless.

I’m just doing renovations I’m not adding expanding the house. The loan is not in any connection to the renovation. It’s just a question on the application. I’m applying for a loan to pay off credit cards. The renovation are paid by a relative. It’s a long story...
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Amarante




 
 
    
 

Post Fri, Sep 25 2020, 3:33 pm
amother [ OP ] wrote:
I’m just doing renovations I’m not adding expanding the house. The loan is not in any connection to the renovation. It’s just a question on the application. I’m applying for a loan to pay off credit cards. The renovation are paid by a relative. It’s a long story...


It’s hard to answer without knowing context. But speaking very generally if you are getting a loan secured by a house, the loan application will ask questions about the house since it is the collateral.
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amother
Mauve


 

Post Fri, Sep 25 2020, 5:41 pm
If your doing construction without a permit I don’t think you’ll get a mortgage. I think you need a C of O to get the loan.
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amother
OP


 

Post Fri, Sep 25 2020, 6:51 pm
amother [ Mauve ] wrote:
If your doing construction without a permit I don’t think you’ll get a mortgage. I think you need a C of O to get the loan.

I have a lot of equity in my home. The loan is in no connection to the renovation. It just happened to be at the same time. We are going to get a permit for the main part of the project after We are done with the renovation.
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