Paid before it left the plant

A standard construction mortgage releases money in stages, each one tied to an inspector certifying that a defined amount of work is physically visible on-site: foundation poured, framing up, roof on, and so forth. A modular build breaks that assumption at its very first stage. The factory manufacturing this family's home required a 30% deposit — $69,000 — before the module was even scheduled to leave the plant, let alone arrive on the buyer's land. There was, quite literally, nothing on-site yet for an inspector to certify.

Left as a standard draw schedule, the file would have stalled at the very first stage: the lender wanting an on-site inspection to justify releasing funds, the factory refusing to schedule a build without its deposit paid first.

The mortgage math itself was ordinary once the draw structure was solved. The land equity did the work a cash down payment would otherwise have done, on a total insured value the CMHC premium tables price the same way whether the home is stick-built or modular.

30.4% and 34.7% sit comfortably inside CMHC's 39% GDS and 44% TDS maximums -- the mortgage itself was never in question on this file. The factory's payment schedule was.

A mortgage professional serving Newfoundland and Labrador structured the draw schedule around the manufacturer's own invoices rather than trying to force a factory build into an on-site inspection schedule it doesn't follow.

First, released the land-equity and foundation draw the standard way. $35,000 of site and foundation work still followed a conventional on-site inspection, since that portion of the build genuinely happens on the buyer's land.

Second, structured the factory deposit as its own draw category, tied to the manufacturer's purchase-order invoice. The lender agreed to release $69,000 -- 30% of the $230,000 module price -- against the factory's own signed order confirmation, not an on-site inspection report, once it had reviewed the manufacturer's build contract and delivery commitment.

Third, staged the remaining factory payments to the delivery and completion milestones. $115,000 released against the factory's delivery-and-set invoice once the module arrived and was placed on the foundation, and the final $46,000 only once services were connected and the home was certified ready for occupancy.

The build funded on schedule against the manufacturer's own invoices, with GDS at 30.4% and TDS at 34.7%, both comfortably inside CMHC's maximums. The factory shipped the module on the deposit's strength, and every later payment followed a milestone the manufacturer itself, not an on-site inspector, could certify.

Newfoundland and Labrador has no verified land transfer tax fact on file for this batch, so no dollar closing-cost figure is quoted here; confirm current registration costs with the closing lawyer.

• 01A modular build's payment schedule doesn't match a stick-built draw schedule, and shouldn't be forced into one. The factory's deposit is due before there's anything on-site to inspect at all.
• 02Structure factory payments against the manufacturer's own invoices, not a generic percentage-complete estimate. A purchase-order deposit, a delivery invoice, and a completion sign-off are each their own kind of proof.
• 03Land equity does the job a cash down payment would otherwise do. Owning the land outright, and contributing its value, is treated the same as cash toward the insured file's down payment requirement.
• 04Get the lender comfortable with the factory contract before the deposit is due, not after. A manufacturer that won't schedule a build without payment has no reason to wait on a lender's second-guessing.
• 05The insured math itself doesn't change because the home is factory-built. CMHC's premium bands price an insured self-build the same way regardless of construction method; the draw structure is the only thing that differs.