va mortgage loans new construction

VA Loans

VA Mortgage Loans for New Construction: Requirements & Process

Are you considering building your own home? If you are a current or former military service member, you may be able to apply for a VA construction loan. 

VA construction loans are slightly more complex than traditional VA loans, but they have their perks. You get to build your home exactly the way you want. And you’ll also be the first person to ever live in it! However, you should be prepared for a longer and more complicated process.

Below, we’ve discussed the requirements and process for VA construction loans in detail.


Requirements for VA Construction Loans

If you are interested in taking out a VA mortgage loan for new construction, you’ll have to meet some specific criteria. For starters, you need to be an eligible Veteran or service member. Additionally, you must also:

  • Obtain the assistance of an insured, licensed builder
  • With the help of the builder, submit a complete set of plans when you apply for the loan
  • Submit documentation regarding the materials you are planning to use for your new home
  • Have the home appraised by a professional


How Does the Process Work?

The process for VA construction loans can be complicated and time-consuming. However, it is far from impossible. Here’s what you’ll need to do:


1. Obtain Your Certificate of Eligibility (COE)

To obtain a loan, you’ll need to provide a Certificate of Eligibility (COE). Your COE acts as proof that you meet all the requirements to receive VA loan benefits. 

Your loan officer can request your COE on your behalf. Or you apply for one on your own by going online or sending the necessary documents through the mail.


2. Get Pre-Approval for the Loan

Now, it’s time to get pre-approved for your loan. It’s important to know that not all lenders offer VA construction loans. So, you will have to find one that provides this specific service. 

Many builders require a pre-approval letter before beginning. Also, getting pre-approved gives you an idea of how much home you can afford and what your monthly payments will be.


3. Find a Registered VA Builder

The next step is to look for a verified VA builder (if you haven’t found one already). You cannot use just any builder. To obtain a VA construction loan, you must use a builder that is VA registered. Then, the builder must adhere to the VA’s requirements for the construction process.


4. Get the Plans Appraised

Once you’ve found a builder and they’ve put together your plans, you’ll need to have the plans appraised. 


5. Close on the Loan and Pass Inspection

After your initial plans are approved, you’ll need to close on the loan. This process can take anywhere from 45 to 60 days. Then once the building is complete, your home will need to pass a VA inspection.


Learn More About VA Construction Loans

If you are interested in learning more about VA mortgage loans for new construction, please do not hesitate to contact our office. We will be more than happy to assist you and provide you with the additional information you need.