- Modification Process - Modification officially converts the construction loan into the permanent mortgage. American Home Bank sends the borrower a modification package to sign and send back to convert the loan. This process starts once Deltec Financial Services receives the final inspection.

- Modification Package - The modification package consists of documents sent by Deltec Financial Services that allow borrowers to "modify" their mortgage. At this time, the borrowers can apply any monies left over from the construction loan or from their own pocket to reduce the final loan amount. If applicable, tax and insurance escrows are set up at this time.

- Escrows - An escrow account set up with a lender holds property taxes and insurance out of the monthly PITI payment made by the borrower until they are due.

- PITI - PITI is the mortgage terminology that stands for principal, interest, taxes, and insurance. PITI makes up a borrower's payment when taxes and insurance are included. If a borrower is eligible and decides to ìno-escrowî the loan payment, the lender collects only principal and interest (P&I) and the taxes and insurance become the sole responsibility of the borrower.

- Final Inspection - The final inspection ensures that the house has been completed to the same degree at which it was initially appraised. The final inspection is required in order to convert into the permanent mortgage.

- Final Lien Search - If applicable in the borrower's state, a final lien search is needed to ensure that no liens have been placed on the property since initial settlement. Modification can occur upon receipt of final lien search.

- Modification Fees - Outstanding fees are due to American Home Bank at the time of modification or loan conversion. These fees usually include, but are not limited to the following items: outstanding construction interest, interim interest on the permanent loan, an escrow deposit for taxes and insurance (if applicable), courier fees for overnight draw checks, and inspection fees.

- Construction Loan Deposit - The 1% construction loan deposit collected at initial settlement is now credited towards the borrower's modification costs. These modification fees are calculated at the time of conversion from the interest only construction loan to the permanent mortgage.