Typical Requirements for an RTM Mortgage

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One of the steps in the process of getting a brand new RTM home project underway is sourcing a mortgage. Getting financing for an RTM home follows a slightly different process than other types of mortgages. Some local lenders, such as Affinity Credit Unions, are more RTM project friendly than some others.

Below are some typical requirements that will come up in the process so you know what to prepare for!

Typical Mortgage Requirements for an RTM Include:

  • The lender will need to release funds before the home is delivered on-site.
  • You often must own the land you plan to build on or need to coordinate the mortgage around this purchase. Changing land titles can delay a project so start asap if you know this will be required.
  • The home must be anchored to a foundation.
  • You will need a contract or purchase of sale with terms spelled out by the builder including obligations for each party
  • Home owners will need to purchase insurance.
  • RTM homeowners will require a building permit to ensure your project complies with local and national code.
  • A water test is often a requirement.

Check with your local bank, some Credit Unions offer a specific percentage of building funds that are advanced based on approved inspections. B&B Homes finds that mortgage brokers may offer more flexible options with favorable rates, but rarely meet the requirements made by us. However, if they cannot meet the terms required for RTMs, Credit Unions’ may be good alternatives. If you would like an introduction to an institution or bank we have successfully worked with, please contact us with your request for an introduction.

Getting Financing & Timelines for an RTM Project

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There are a few different phases of an RTM project before the exciting moving day when a brand new RTM arrives at your foundation location. One of the most important aspects that needs to be in place in order to kick-off a project is securing financing from a lender.

When you are pursuing financing for an RTM project some things that they may ask for include:

• You often must own the land you plan to build on or need to coordinate the mortgage around this purchase (changing land titles can delay a project so start asap if you need to do this)
• You will need a contract or purchase of sale with terms spelled out by the builder including obligations for each party
• Some lenders will request a copy of your blueprints for the project
• Homeowners will need to purchase insurance for when the home is on the foundation (B&B Homes and the moving company insure you before the RTM arrives)
• RTM homeowners often require a building permit to ensure your project complies with local and national code (this can be done through your local municipality and can also cause delays so reach out to them early in your planning)
• A water test is often a requirement for a mortgage (be prepared for them to ask you for one)
• The home must be anchored to a foundation (not placed on a slab)
• The lender will need to release funds before the home is delivered on-site

B&B Homes requires different payment draws at different stages of the project that will need to be approved by your lender. For example, a deposit is due to commence the project, a schedule of payment draws will follow with a final payment due before the home leaves the yard. Contact Suzanne to learn more about B&B Home’s payment draws or to request an introduction to our preferred mortgage specialist.

Please note: Some lenders (such as FCC and others) may ask you to show proof of insurance from the builder and moving company. We are happy to provide this information at your request.

Once you have your estimate and blueprints prepared and financing in place, the build itself will begin to move very quickly compared to the planning phase of the project.

For more information on the different stages of the project, visit the RTM Project Timeline Roadmap.

RTM Home Build vs On-Site Construction

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When making plans for the future there is often a time lag between what you want and the reality it will take to get there. There is no exception to this when it comes to building a new home. There are a few different paths you can take to build a custom designed home in the prairie provinces. Whether you are considering the RTM process or building on site, weighing the pros and cons can help you make an informed decision about which direction to go in. Project management, length of time to do the project and cost are all considerations that must be made.

Some mortgage lenders may inform you that getting financing for an RTM will be more difficult but that simply isn’t true. There are a number of lenders throughout Saskatchewan and Alberta that finance RTM homes and require similar deliverables regarding your proposed project.

Do You Want To Be the General Contractor?

It can be challenging to find reliable trades that value quality craftsmanship in some rural communities. When building on site you have the option to be the general contractor of the build. Knowing your own capabilities and the local expertise will help you determine if you are quipped for the job with the right team. Knowing the availability of supplies and the security of your location will also help in factoring whether or not it is more convenient or practical to do on site.

Timing, Now or Later?

Building on site is a seasonal endeavor. When exploring the RTM process, know that timing can be a huge factor if you are ready to go. The design and build can be done during the cold winter months and ready to be set when the frost thaws in spring and a new home up as early as next summer.  Fluctuations in weather and timelines are more controlled when you start early with an RTM build.

Cost

Comparably it is similar. B&B Homes delivers homes to communities without skilled trades throughout Saskatchewan and Alberta with Neufeld Movers. Ensuring your builder has the appropriate qualifications and certifications is important as a caution to quality. Experienced builders bring the latest in technology and resources that can assist in managing the potential stresses of the project with efficiency. They can also offer additional services that allow you to make environmentally friendly decisions about using solar energy and other renewable resources.

Evaluating your options and the pro’s and con’s of each process will help you make a decision with confidence. The team at B&B Homes is here to answer any questions you have about building a custom designed home.