Washington Federal Prefab and Modular Home Construction Loan Review
Washington Federal Bank is a bank that serves the Western United States with lending products well-suited for financing for new prefab and modular homes. They offer both lot loans to finance land and construction loans to finance the build process. As a portfolio lender, Washington Federal Bank won’t sell your mortgage to another bank on the secondary market. This can make it easier to qualify for a loan as well as simplify the entire process. While project requirements and individual criteria like credit score will affect the possible loan amount, the maximum loan amount from Washington Federal Bank is typically $3,000,000. While Washington Federal Bank typically does not have issues financing prefab home projects, they often need to approve the chosen company for any given project.
Washington Federal Bank offers both 15 year and 30 year fixed rate construction loans. They disperse the draws based on the percentage of completion of different line items. Draws are usually done on a monthly basis. Buyers can also choose to combine their construction loan with a mortgage from Washington Federal to further simplify the process. This option locks the permanent interest rate before buyers break ground, eliminating the need to requalify for a loan or to get a second appraisal after the prefab home is finished.
For lot loans on approved land, Washington Federal offers up to $700,000. Both 20 year principal & interest loans as well as 24 month interest-only loans are available. The 24 month option is designed for buyers who plan to start building before the end of that 24 month period. All lot loans require a 30% minimum down payment.
| Lender | Washington Federal Bank |
|---|---|
| Website | https://www.wafdbank.com/ |
| Lending Area | AZ, ID, NV, NM, OR, TX, UT, and WA |
| Maximum Loan Size | $3,000,000+ for construction, $700,000+ for lot loans |
| Term | 15-30 years with no prepayment penalty for construction, 20 year principal & interest for lot loans, plus a 30% down payment |
| Offer Land Financing? | Yes |
Notes on Washington Federal Bank’s Prefab and Modular Home Construction Loan:
Washington Federal’s Lending Timeline:
Credit approval: Buyers meet with a local loan officer to complete their home loan application.
Purchase Agreement - When the buyer has settled on a purchase with their land’s seller, the buyer and the lender work together to process the application and complete the home financing.
Underwriting – The lender submits the final documentation to the underwriter for final approval. The underwriter looks at the 3 C’s: Credit, Capacity (income, cash, liquid assets, etc), and Collateral (type of property, occupancy, loan to value, etc).
Once the project and credit approvals and the appraisal are completed, the loan can get the final sign-off and is prepared for closing.
Closing buyers complete a final walkthrough of their lots and receive approval for financing.
Project begins! Custom construction loan officers work with buyers to manage monthly payouts.