We got one more thing checked off the list. Met with our NVR loan officer yesterday. Things worked out perfectly. Yes, we qualify for both the new mortgage and our existing mortgage, so construction can start before I have a buyer. It's looking like the timing will overlap by a few weeks.
Plans did change a bit on our closing amount. We decided to pay the one time PMI at closing rather than roll it into the monthly payments. Basically, I'm taking $4,400 from the down payment and applying it to the PMI. It makes a much bigger impact on reducing the monthly payment, saves money in the long run and would be the same out of pocket dollars at closing. It's a win-win. So now our monthly payment is about $100 less than what we were originally planning!
We should hear back in about 3 weeks if we are approved. There shouldn't be any problem at all, but until then fingers are crossed.