Building your dream home is possible thanks to the VA apartment loan. But this is not always the easy way. This indefinite repayment program allows qualified borrowers to use their VA loan entitlements to obtain a mortgage for a new construction. But finding lenders ready to get a VA $ 0 construction loan can be difficult. Can you get a VA loan to build a house?
Obtaining construction and land loans
Getting a traditional construction loan often requires a down payment, although in some cases it may be possible. We will talk about it soon.
When it comes to looking for a construction loan, you can pay to look around. Talk to many construction companies and financial institutions, compare down payment requirements, estimated closing costs, and more.
Some builders may have programs or offers especially for veterans and military families. Do your homework and make sure you work with a legitimate builder with success and satisfied homeowners.
Why use a VA loan?
Although it may not be for everyone, VA mortgage is an amazing opportunity.
About 9 out of 10 VA homebuyers buy without money. Despite this flexibility, these loans have had the lowest market access closure rate of all credit products for almost all the past five years. VA lenders are usually looking for a credit rating of at least 660, which is much lower than usually needed for conventional financing (and with advance payment of at least 5 percent).
Best of all, even in these difficult economic times in which traditional financing has become difficult to secure, VA mortgages continue to make homeowners a reality for men and women who America owes so much.
What can I build with a VA loan?
Lender standards are extremely important for this type of VA housing loan. Not all lenders will grant loans for all types of real estate, and construction loans are no exception. Some lenders will not approve VA construction loans for mobile homes, modular homes, or manufactured housing.
These lenders can ONLY approve houses built on a stick, which is the definition of a typical house built from scratch.
Some VA lenders may not approve VA construction loans for multi-flat properties, but others may. You will need to discuss your house plans with a Loan officer to see what might be possible.