What must a member do to initiate a construction loan before permanent financing?

To initiate a construction loan before obtaining permanent financing, a member must qualify for the desired PITI (Principal, Interest, Taxes, and Insurance) through NACA. This step is crucial because the construction loan process is closely linked to the member's ability to demonstrate their financial capacity to handle the projected monthly payments once the construction is completed and permanent financing is in place. NACA's qualifying process includes reviewing the member's income, credit, and overall financial situation to ensure they can afford the costs associated with the loan.

This requirement serves as a foundational element in the loan process, ensuring that members are not only able to start construction but also prepared for ongoing payment responsibilities, which ultimately lays the groundwork for successful homeownership. The focus on qualifying the member helps protect both the financial institution and the member by promoting sustainable borrowing practices.