Are you wondering if you can use a veteran home loan to build a custom home? Maybe you’ve been home shopping for a while and have been disappointed by the already-built homes in your area. Or perhaps you’ve just returned from deployment and are looking to settle down in a home that suits your lifestyle and needs. Well, good news! You’re in luck! You can use your VA financing for more than just an existing home; you can also use it to build your dream home! Here’s what you need to know.
VA Construction Loans for Custom Homes
If you’re looking to build a custom home, you’ll most likely need to apply for a VA construction loan. VA construction loans allow eligible veterans and active-duty service members to finance the construction of new homes.
These loans are unique because they combine two types of financing: a short-term construction loan to cover the costs of building the home and a long-term mortgage loan that will be used to pay off the construction loan once the home is completed.
With a VA construction loan, borrowers can usually borrow up to 100% of the total cost of the home, including the land and construction costs, which means that no down payment is required.
Buying Land with a VA Construction Loan
It’s important to note that the VA has restrictions on using VA loans to buy land alone. If you’re planning to buy land with a VA loan, you must build a home on it. Additionally, that home must be used as your primary residence.
Benefits of Building a Custom Home with a VA Loan
Building a custom home can offer a range of benefits for veterans and their family members. Custom homes allow personalization, accessibility for veterans with disabilities, energy-efficient upgrades, and other perks. Since interest rates are competitive and there’s no down payment required, VA loans are an affordable way to finance a custom home.
Steps for Building a Custom Home with a VA Loan
The process for building a custom home with a veteran home loan tends to be a little more involved than buying an existing home. But trust us, it’s worth it! In the end, you’ll have a beautiful new home that’s fully personalized according to your preferences and needs. Here are the steps involved:
- Find a lender that offers VA construction loans.
- Find a custom home builder.
- Wait for the VA to submit an appraisal based on the building plans.
- The builder constructs the home according to the details you two have worked out.
- The VA conducts a final inspection to ensure that the property meets its requirements and is safe, sanitary, and sound.
Apply for a Veteran Home Loan
Get started with the application process today or call our office to speak to one of our mortgage experts directly.