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It's just an underwriting questions for the bank (or whoever the lender is for that one)
If whoever makes THAT new loan sees you as being able to service that much debt ... is the only questions, It's completely legal
I see. Another question regarding the construction loan. I have talked to a few lenders who have stated if there is enough equity in the land then there will be no need for a down payment on the construction of the new house. What exactly does that mean?
When lenders look at making a loan. that look at several factors .... one of them being how much equity (fair market value of the property minus the debt that would be on it) there is
If they feel that there's easily enough there that they could sell it, pay off the loan and still be in the black (should you default) they' ease terms... like downpayment, rate, etc
Okay, that makes sense. I appreciate your help today and I will rate as excellent.
Thanks so much ... let me know if I canhelp further