Hello, we are doing a construction loan only, for ATR purposes and DTI qualifications loan officer wants to base it off of int. only monthly for 12 months based on full loan amount, can we do this if we have a permanent financing approval letter?

thank you!

Loans of 12 months or less are exempt from ATR.

raitchjay is correct, but what lender in their right mind does not underwrite a construction loan like a permanent loan to make sure the borrower can actually qualify for a take out, unless the bank is chomping at the bit to repossess a brand new house. Even with an approval letter - what if the lender reneges.

Randy...i almost said close to the same thing, but the mention of the takeout letter made me refrain.......but i appreciate your point and am glad you made it.

thank you both... we did do our due diligence in the case the lender withdraws for perm.