Purchase
HOW TO GET A LOAN TO BUILD A HOUSE

Getting a construction loan to build your very own custom home from the ground up is a little different than buying an existing home. We have two types of construction loans to help you make your dream home a reality. Here are some requirements to help you get started:

  • Use a qualified builder. Anyone less than a licensed general contractor with a proven track record will make getting a loan harder. If you’re acting as your own general contractor, you may have additional requirements to prove you’re qualified for the job.
  • Get an appraisal. How do you appraise something that doesn’t exist? Most likely, you will need to have an appraiser consider any specs or blueprints of the house, in addition to the value of the land. They compare that information to similar homes in similar locations and determine the value from there.

One-Time vs. Two-Time Close

A One-Time Close is the perfect option if you want to save time, whereas a Two-Time Close is a great option if you’re more focused on saving money.

One-Time Close

This option is truly as simple as it sounds, combining an interim construction loan with a permanent mortgage loan into a single transaction. That means you only have to fill out one application and go through one closing. Program benefits:

  • You pay only one set of closing costs
  • Pay as little as 10% down for primary residences
  • You take title to the property right away, allowing you to begin building equity immediately if values improve

Two-Time Close

This is a two-step process where you first obtain a temporary loan to get the project started. Then when construction is complete, you refinance your initial loan to get your regular mortgage at the most favorable terms possible. Advantages include:

  • We’ll lock the interest rate for your second refinance loan up to 9 months. This protects you against rate increases, and the lock fee will be refunded when the loan closes.
  • Your first loan will come with a fixed rate and you only pay interest on money used for construction, not the entire loan amount.
  • When you refinance your initial loan to your regular home mortgage, you’ll receive closing cost credits that may result in low- or no-cost refinancing.

PrimeLending loan advantages

Luckily for you, PrimeLending can help with this complicated process. Getting a construction loan has never been easier. Here are just a few benefits that we provide to make the processer smoother:

  • We’ll lock the interest rate for your second refinance loan up to 9 months. This protects you against rate increases, and the lock fee will be refunded when the loan closes.
  • Your first loan will come with a fixed rate and you only pay interest on money used for construction, not the entire loan amount.
  • When you refinance your initial loan to your regular home mortgage, you’ll receive closing cost credits that may result in low or no cost refinancing.

PrimeLending Lot Loans

If there’s land you want to purchase and build a home on, but you have yet to choose a builder or secure any additional details regarding construction, a lot loan is the perfect option. Lot loans give you 12 months to pick a builder and set final plans for your home, putting time on your side.

Lot loans offer numerous benefits, including:

  • Financing without a builder in place
  • Fixed rate; interest-only payments
  • A year to make decisions on your home
  • Easy refinance process into a construction loan
  • Any value appreciation adds to borrower equity

Construction loans from PrimeLending

From deciding where to put light switches to picking out colors and appliances, you’ll have plenty to think about. So, we’ll take any concerns about financing off your mind. We assure fast, efficient closings* and hassle-free document collection and submissions. We also promise to support and keep you informed throughout the entire loan process. Every step of the way.

You Can Build a Home Like No Other.