Q: Why does my bank need a "abundance of caution lien" on my paid off home in order to get a new $550k construction loan?
The new home build lot I own outright has a value $155k. My income per month is $6500 after taxes. My DTI is 32% and my FICO is 771
Based upon the (limited) financial facts presented (your age being the most important unknown fact omitted), IMPO your best course of action is to shop around for a new bank that appreciates excellent customers like you.
Having been a commercial bank officer myself--before going to law school--there appears to be a world of difference between the very conservative bank you bank with now and many other reputable banks that do not demand silly things like "abundance of caution liens"--liens against other valuable property or assets owned free and clear by excellent customers holding as many aces as you now hold. Back in my day the smartest bankers saw great value to be gained by helping our well-heeled customers become even better-heeled; why? Because helping wealthy customers become even more wealthy insured their continued success--and also insured greater success for our growing bank.
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