With two teenaged daughters getting ready to leave the nest, Lindsey Bamba and her husband were looking to downsize their home. However, with Puget Sound housing inventory at historically low levels, it wasn’t so easy to find what they were looking for. Fortunately, as a District Manager at Olympia Federal Savings (OlyFed), she was familiar with the company’s construction loan program. In the end, the couple bought a property and had a brand-new house built to their specifications.
Bamba and fellow District Manager Casey Kilborn both took advantage of OlyFed lending programs in the last year and it provided them with insight into how the process works for clients. New construction and purchase remodel loans are more in demand than ever and OlyFed offers multiple lending options, local contacts and resources to support clients.
Low inventory is a key factor driving that demand, according to Kilborn. “People are finding the area where they want to live, but maybe not the house of their dreams,” he explains. “The purchase remodel program helps them buy in the area they want and then make the house what they want it to be.” The program also allows clients to borrow against the future value of the home rather than borrowing once to purchase the house and again to renovate it.
Kilborn now has first-hand experience of the program after buying a home built in 1972 that was close to schools but needed a lot of updates. His family’s priorities included an open concept floor plan and ways for everyone, including his 6- and 9-year-old children, to have their own space. “The contractor did a walkthrough with us to talk about our options and give us an idea of how much it would cost,” he says. “We submitted our plans for updates to the appraiser so they could value the property based on the suggested upgrades and enhancements. The result was a great house that is exactly what we were looking for.”
Bamba’s situation was different. Aside from downsizing to a single-story house, they had one other non-negotiable. “Our motivation was actually a shop,” she explains. “We looked at a lot of single-story properties that either had a shop or had room for a shop, so we could have also done a purchase remodel project. But we weren’t finding anything we loved and with the construction loan, we were able to have a new house and shop built all at the same time.”
Using the construction loan program, she and her husband were able to pick out their floor plan, choose their materials and colors, and design the house they wanted. “It was nice because you can either own your property or potentially purchase the property at the same time as you’re borrowing to have your house built,” she says. “It gives you some flexibility around making the house what you want it to be. When you’re talking about an investment that size, the most important thing is that it fits your needs, your family and your lifestyle.”
While the Bambas wanted to downsize, many of her clients are interested in going the opposite direction. As they outgrow their current home, they begin seeking something larger only to be frustrated by the tight housing market. That’s when some decide to add on to their existing homes, she notes. “We offer a lending program that allows you to refinance your home and remodel it, while taking into account the future appraised value with the additions and/or upgrades included. This helps extend your borrowing power and as a local portfolio lender, this is something unique OlyFed can offer. Many regional or national companies cannot provide this future value option and most often require clients to borrow against just their current equity.
Going through the process themselves has been educational for both Kilborn and Bamba. Now, when they talk to clients about the different loan options available through OlyFed, they’re able to offer tips based on their experience. “When you meet with a lender, have an idea of what your budget might look like,” says Kilborn. “Get together a plan of what you’re looking for and then be flexible.”
Bamba agrees. “Start by talking with a loan officer, get a good idea of how much you want to spend and then make sure it’s a good fit with your contractor or builder,” she says. “That’s important because, depending on the scope of work, you could be in a working relationship with your lender and your contractor for a long time.”
Whatever type of loan clients need, OlyFed has a program for it, according to Bamba. “As a portfolio lender, all our programs stay here with us,” she points out. “We help you throughout the process and you’ll be working with the same team of people. Even better, as non-commissioned Loan Officers, our team of professionals are incentivized to put your best interests first. In this time when properties go so quickly, there is always someone on our team you can reach out to for support and insight.”
Learn more by visiting the Olympia Federal Savings website.