I-W-I is short for Insurance, Warranties and Inspections. The Builder must have active insurance policies to include both General Liability and Builder’s Risk Insurance. If a General Liability Policy does not already exist, a less expensive alternative is to purchase a Supplemental Personal Liability Policy to the Builder's Risk.
When a homeowner will be refinancing their construction loan into either a VA or FHA mortgage, the mortgage lender will require the builder to provide certain information and documentation on the home. Included in this may be copies of the inspection reports and construction warranties. If the property is inside city limits, the city will have mandatory inspections to support the permits. Yet if the home is outside city limits, the builder may be required to obtain inspections from licensed real estate inspectors. Furthermore, the refinance lender may require the Builder of Record provide a 10 year warranty supported through a Warranty Program. Click HEREfor more information.
Managing the construction of a home involves much more than project management and subcontractor/vendor relations. Residential construction is a complicated process and the Builder of Record needs to have extensive knowledge of city and county regulations, utility set up, insurance guidelines, inspections, budget management as well as construction knowledge. More than paperwork, the person managing the build must be able to walk onto a job site at any point in time and identify faulty work by subcontractors and know how to resolve the issues at minimal expense.
It is for these reasons the Builder of Record must be able to show residential construction knowledge and experience. For a homeowner to act as their own builder, they must show they have either  built homes for clients in the recent past and provide client and supplier references, and/or  provide a work history to support residential construction knowledge.
The Builder of Record will need to execute several of the loan's legal documents, including a Mechanic's Lien. These documents must be executed by a Company, not an individual. Thus a homeowner who wants to act as their own builder must
establish a Limited Liability Company [LLC] or Corporation [INC] as the Builder with the State of Texas [not a DBA or Assumed Name].
Also, Texas Property Code details funds received for residential construction be kept separate from a builder’s administrative and personal funds. Hence, a bank account under the Builder’s company name must be in place, and accounting records must keep construction funds separate from administrative costs. Furthermore, the Builder’s record keeping must separate funds used for each individual project/home.
Construction Financial Solutions is one of the few interim lenders who does allow an individual to act as their own builder if they are able to meet certain criteria. Doing so will save the homeowner in builder overhead and places more control on the completion timeline. Do you think you have what it takes? Let's find out!
Libra Enterprises, LLC dba Construction Financial Solutions Copyright 2019
Libra Enterprises, LLC dba Construction Financial Solutions is licensed under the laws of the State of Texas and by state law is subject to regulatory oversight by the Department of Savings and Mortgage Lending. Any consumer wishing to file a complaint against Libra Enterprises, LLC dba Construction Financial Solutions should complete, sign and send a complaint form to the Department of Savings and Mortgage Lending, 2601 North Lamar, Suite 201, Austin, Texas 78075. Complaint forms and instructions may be downloaded and printed from the Department's web site located at sml.texas.gov or obtained from the Department upon request by mail at the address above, by telephone at its toll-free consumer hotline at 1-877-276-5550, by fax at 1-512-475-1360 or by e-mail at firstname.lastname@example.org.
The Department maintains a recovery fund to make payments of certain actual out of pocket damages sustained by borrowers caused by acts of licensed Residential Mortgage Loan Originators. A written application for reimbursement from the recovery fund must be filed with and investigated by The Department prior to the payment of a claim. For more information about the recovery fund, please consult The Department's website at sml.texas.gov.
National Mortgage Licensing System Registry #1771431. Construction Financial Solutions is located at 18568 Forty Six Parkway, Suite 3002, Spring Branch TX 78070.
Lenders are required to provide the "Your Home Loan Toolkit", which has been provided by the Consumer Finance Protection Bureau created to comply with federal law pursuant to 12 U.S.C. 2604, 12 CFR 1024.6, and 12 CFR 1026.19(g). This is for all loan transactions effective 10/3/2015.
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