SunTrust Closes Construction-Perm

[Alison Swain]

That little gem was one of the headlines in my daily e-mail tease from MortgageDaily.com

I don't subscribe, so I can't post from the article. They did include this much though:

[FONT=Times New Roman,Georgia,Times]SunTrust Mortgage Inc. is eliminating its construction-to-permanent program.[/FONT]
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[FONT=Times New Roman,Georgia,Times]The Richmond, VA.-based lender issued a bulletin to its wholesale clients on Friday notifying them of the move. The decision was based on "ongoing credit risk associated with construction lending."[/FONT]
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[ghrousseau]

That's nothing new. Construction to permanent has been very difficult going back to last summer. Many lenders had existing construction loans on the books with properties being built. The changes in investor guidelines made the approved take out loans with the end lender invalid. Many borrowers couldn't qualify for the take out loan with full documents. Also, the declining equity position made it pretty perilous as well. There are a few lenders in my region like BB&T that have a niche program that basically eliminates the need for a take out loan. Also the demand for these programs has dropped considerably. Most investors are now focused on rehabbing properties instead of the high risk for building new.

 

[Anthem]

I can't seem to find that information anywhere else.

This was Suntrust's claim to fame product, they locked in your perm rate when you started your construction loan. A close friend of mine is in the process of getting one of these loans.

 

[ghrousseau]

I can't seem to find that information anywhere else.

This was Suntrust's claim to fame product, they locked in your perm rate when you started your construction loan. A close friend of mine is in the process of getting one of these loans.

Preston,

I'm in VA but we do business in your neck of the woods. I'll PM you with info on who I know currently has a program and what it looks like.