Once JEMS receives a loan request there are a series of evaluation procedures that are initiated.
JEMS will analyze the specific market in which the loan will exist.
This analysis will take into consideration comparable sales and current property listings. JEMS will inspect
properties in both categories. In addition, JEMS requires independent appraisals
in any community they are not intimately familiar with.
JEMS will conduct a site inspection to ensure its suitability for the proposed
construction and to identify and site specific characteristics that might impact marketing or
construction budgets. Such characteristics might include wetlands, ledge, severe grade changes
or undesirable surroundings. JEMS has dealt with all of these circumstances on a repeated basis
and has an understanding of the affect they may have on a development.
We make sure these important contingencies are reflected in marketing and construction proformas.
Plan and Specification Review
JEMS requires all loan applicants to submit copies of plans and specifications for the homes they
intend to build. JEMS reviews these plans and specifications to ensure they are consistent with
the market in which they will be built as well as with the proposed end value of the property.
The relationship between product and price is obviously integral to the success of a project.
JEMS is able to draw on its current and past market experience to confirm that proposed
projects adequately address this relationship.
Construction Budget Review
All loan applicants submit a detailed construction budget identifying by line item
the cost of each component of the home they intend to build. JEMS reviews these budgets in detail
to ensure the costs are reasonable based on the proposed plans, specifications and site characteristics.
This construction budget will form the framework for loan disbursements as development progresses.
If the format of the construction budget does not properly conform to the manner in which construction
will proceed in the field, it becomes difficult to maintain the loan to value ratio.
Through their knowledge of the construction progress, JEMS is able to ensure budgets are properly established.
Confirm All Necessary Permits and Applications
JEMS requires a valid Building Permit before any construction disbursements will be made.
In the event a borrower must purchase land prior to obtaining a Building Permit,
JEMS reviews all applicable permits and approvals including septic designs and
approved site plans. In the absence of a Building Permit, JEMS will often times
require a letter from an attorney or engineer certifying that the subject land is buildable.
JEMS has expertise in the permitting and approval process on the local, state and federal levels.
JEMS is very careful that all necessary approvals are in place before closing a loan. Once a loan
is in place, JEMS closely monitors construction. Borrowers submit disbursement requests as work is
completed. JEMS performs on site inspections to confirm the work complete in the field is consistent
with the disbursement request. JEMS is diligent in these inspections as it is crucial that the loan to value ratio is adequately maintained.
If JEMS feels there are any inconsistencies between work complete and disbursement requests they resolve them directly with the borrower.