How Vectra Bank Colorado is Helping Customers Build the Home of Their Dreams
Vectra Bank's One-Time Close loan is helping local homeowners build their dream abodes.
The process of building a home can be a long and complex endeavor. Most homeowners are intimately involved in the planning and design of their dream home, which itself can last anywhere from six months to two years. This level of involvement has an impact on financing, as being involved with all the details and consulting with the contractor means consumers need a mortgage product they can trust will take them from groundbreaking to closing.
Since the process is so lengthy, the challenge is to obtain a mortgage rate that ensures the customer will qualify once the home is complete. Just last year the Federal Reserve raised its benchmark rate four times - meaning one might qualify for a certain rate at the beginning, but in the time between then and the home being completed, the rate situation could change dramatically.
That is why Vectra Bank Colorado's One-Time Close home loan is a great solution for consumers looking for rate protection when they set out to build their dream home. By locking their interest rate in upfront, homeowners can have peace of mind knowing it won't change and they can devote their time to the building process. The best part is the customer does not have to requalify when the home is complete.
One-Time Close: Offering bevy of benefits
The One-Time Close product works like this: The customer completes an application and qualifies as they normally would for any other mortgage loan. That regular process includes reviewing the customer's credit report, income, assets, and other factors. At the same time, an appraisal is conducted. Utilizing plans, specs and budget, a "to be determined" value is obtained based on the home being completed per the plans. The interest rate is then locked upfront prior to the loan closing.
"We qualify the customer upfront, the customer works directly with the contractor to build the house, we modify into the permanent loan when the home is complete and the customer has the peace of mind knowing they will not have to requalify for the permanent loan," says John Ablutz, Vectra Bank mortgage sales administrator.
A fixed rate during construction is a huge advantage to the One-Time Close - but it's not the only perk. Customers are also highly satisfied with the structure of the loan. For example, borrowers make interest-only payments on the outstanding balance of the loan, rather than paying interest on the entire loan amount. As the balance of the loan goes up, so does the payment. This feature saves the customer thousands of dollars over the life of the construction loan.
A streamlined loan experience is another benefit One-Time close customers have hailed. Vectra Bank has heard from customers like Paula from Denver that One-Time Close has made the entire process much more quick and painless.
"I heard about Vectra Bank from a realtor in Denver and friend of my daughter and son-in-law," Paula from Denver said. "John Ablutz then told me about One-Time Close. This type of loan certainly made the process easier. We were told it would take up to six weeks to close, and it was closer to four weeks. The support of John has made us Vectra Bank fans."
High-touch interaction: A plus for everyone
Usually, the standard mortgage process is pretty cut and dry, with not much personal interaction: Borrowers meet with a loan officer, go through some paperwork and shake hands at closing 30 to 60 days later. The customer experience with One-Time Close is much deeper, and a source of satisfaction for all stakeholders involved: borrower, builder and banker.
"We actually have the opportunity to have monthly interactions with the builder and borrower when the draws are being processed, so there are a number of opportunities to go out to the job site and speak with the customer," says Ablutz, who has driven to locales like Durango, Grand Junction and Pagosa Springs - all to assist his customers. "Just like anybody else, when they're building something special, homeowners are very proud and they want to talk about plans and the progress."
Such visits provide a valuable time to touch base and troubleshoot the snags that are bound to appear during construction. In a sense, building a home is a bit like being married, Ablutz said, with communication and teamwork being especially important.
"The deeper we get into the process, the more customers tell me, 'We're kind of stuck together at the hip,'" he said. "We're all in this together and our goal at Vectra Bank Colorado is provide a great customer experience."
Not only has the One-Time Close program been great for homeowners, but also for builders. The builder no longer has to use their funds to build the home and hope the customer qualifies in the end. This product provides builders the opportunity to concentrate on building the home rather than the financing aspect of the process. It also allows the builder more flexibility to have the customer do the shopping for certain items rather than them doing it for the customer.
One-Time Close is driving growth for Vectra Bank Colorado, while helping homeowners realize their dreams. Interested in how you can benefit? Contact us today.