Decide which type of construction loan you want.

There are different types of home building loans available.  The most available loan only covers the construction phase and not the long-term mortgage.  If you choose this type of loan, you will have to close twice, once for the construction and again for the mortgage loan. There are specialty lenders available that will provide a construction to permanent loan so you only have to close once.


Conduct lender research.   You want to make sure that the lender is reputable and you don’t find yourself in one of those consumer horror stories you read about.  Make sure to be very thorough when researching lenders.  Read reviews on various review sites.  You can use search engines as well.


Get pre-qualified for the loan.  Before you can start your home building project, you will need to know what your budget is.  You’ll need to know the maximum loan amount you qualify for as well as the down payment required.


Decide where you want to build.  Now you can start looking for the location where you want to build.  You may want to build in a suburban neighborhood or you may want to build on rural property.   Once you’ve determined the type of neighborhood you want to live in, you can begin your search through various neighborhoods or rural properties.


Find a builder. 

Do your research on builders.  Find out if their building quality has issues with a lot of defects.  You don’t want to build a home that starts falling apart a year later because the builder took shortcuts.   As previously stated, use review boards and search engines.


Verify the builder has insurance.  The lender will require an all risk builders risk policy and a general liability policy covering construction operations.   Most reputable home builders will provide the necessary coverage while your home is under construction.   If the builder won’t provide insurance, then you will have to purchase these policies.


Taking out a home building loan requires a few steps on your part.  Be sure to conduct research on your lender and get pre-qualified so you know your building budget.  Decide where you want to build and research your builder.  Verify if the builder will provide the lender required construction insurance.





Courtland Building Company would love to help you plan your green home, call us today: (281) 932-4494

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