By the end of February, many northern Minnesota residents are infected. Although bouts of flu come and go, the infection in late February is often related to “cabin fever,” an “unhappy and impatient feeling” that comes from being indoors for too long. For some people, dreaming and planning home or cabin construction projects for the coming season is a relief for that pent-up feeling.
Grand Rapids State Bank is one of dozens of vendors who annually participate in the Northern Minnesota Builders Association Home and Cabin Show. It is typically held at the Grand Rapids Arena in early March (almost always the same weekend as the Minnesota boys’ hockey tournament weekend).
“The way we make loans for new construction projects is something that differentiates us from our competitors,” explained Dale Rosier, Vice President-Personal Banking. “By filing the mortgage once, the customer ends up with only one set of costs on the front end, and this makes it more affordable.”
New regulations promulgated by the Consumer Finance Protection Bureau last October have put more steps into the process of making a construction loan, explained Steve Levar, Vice President-Personal Banker. The Truth in Lending and RESPA Integrated Disclosure (TRID, for short) has introduced a few more steps that bankers must comply with.
“The Know Before You Owe regulations are intended to protect customers,” said Steve. “We take our responsibilities seriously, and adhering to these rules is one more way our customers know we are underwriting their loans properly.”
With GRSB’s home construction loan, a customer can work with a contractor who knows the ropes or serve as their own general foreman if they have the skills and sweat equity to invest in the project. An appraiser will provide the bank with an estimate of the finished value of the construction project based on the specifications in the construction drawings. GRSB then helps the customer meet the gap between the value of the land and the finished project. The amount of the down payment can be very flexible, and many customers find that appealing.
“The Home and Cabin Show sponsored by NMBA is a good way for us to let people know about our construction loans,” added Cory Colter, Assistant Vice President-Pokegama Office. “We’re hoping that as prospective customers tour the show, they’ll have good ideas about what they want to build. They can stop at our booth and pick up information about how to finance those dreams.”