When you decide to work with home builders on building a new house, you’ll probably start to look for ways to finance the project. Loans for newly built houses are slightly different from regular mortgages, so you should make sure that you’re aware of how the new construction loan process works.
Step 1: Create Your Plan
Before you talk to a mortgage broker, you should develop a vision for your new house. Decide on its size, scale, and location. Also, consider factors that might make the project more complex. For example, if you decide that you want solar panels or geothermal energy, then your project may require special sources of financing before it the home builders can get underway.
Step 2: Research Your Lending Options
Although new construction has increased significantly as available house inventory has sold down, many lenders got away from new construction during the economic recession. Some of these lenders left their clients without financing in the middle of the building project. Do some research to make sure that your lender has a good reputation.
In addition to ensuring that your lender is in good financial shape, you’ll also want to look for the best available interest rates when you’re shopping for a loan. To save time, a mortgage broker can research multiple lenders for you to find the best option.
Step 3: Conduct a Builder Review
Once you’ve selected an appropriate lender, your lender usually starts researching your chosen construction company by performing a credit check. … Read More