Construction Loan Checklist
Construction loans may have additional requirements for qualification and approval because banks take additional risk on construction loans. If a borrower is not able to make the payments, the bank is limited on how they can recover the lost funds.
Here are of the few requirements you may anticipate when qualifying for new home construction financing.
- Good to excellent credit
- Stable Income
- Low debt-to-income ratio
- A 20 percent down payment
- Building lot details
- Construction timeline
- Detailed plans
- Realistic budget
- Contract with the contractors or general contractor working on the project
Some specialty homes like log cabins, pole barn homes, and manufactured homes have additional qualifications and may require different financing options.
Friendship lenders are great resources for information. Call 812-667-5101 to schedule a free consultation today.