Builder offering loan much lower than banks
I have put down $1000 earnest money to build a small house. I know the builder, but he's not like a lifetime friend. When I contracted the build, I was looking at a 6.0% and rates were going down. Today, for a long lock that brings me up to the closing date of Aug 3 I am looking at 6.625. the builder has offered, open ended, a 6.0 and I could probably get him down to 5.8. Closing isn't till Aug 3 so I said let's wait and see. It's nice to have the peace of mind to be able to wait and see what rates do. The only downside of going with the builder is they can't/won't escrow tax and ins. To me that makes no difference, I'll just save a little each month to pay it outright.
What questions should I be asking the builder? So far, I can gather that it would be just like any other mortgage except for the no escrow thing. He also said "closing costs would be almost nothing" but I have yet to get specifics on that.