Which document is essential for determining construction loan disbursement schedules?
Correct Answer
B) Construction contract and draw schedule
The construction contract and draw schedule outline the phases of construction and specify when funds will be needed, forming the basis for the lender's disbursement schedule throughout the construction process.
Why This Is the Correct Answer
The construction contract and draw schedule outline the phases of construction and specify when funds will be needed, forming the basis for the lender's disbursement schedule throughout the construction process.
More Origination Questions
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Previous Question
A borrower has a construction-to-permanent loan with a 12-month construction phase. At month 10, construction is only 60% complete due to delays. What is the most likely outcome?
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An appraiser contacts an MLO stating they cannot complete an appraisal by the scheduled closing date due to property access issues. The borrower asks the MLO to pressure the appraiser to rush the report. What is the MLO's appropriate response?