Board Topic: New Construction Loans - harder to get?
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New Construction Loans - harder to get?

Posted by: born2drv Nov 24 2004, 01:19 AM
Hello. Are new home construction loans more difficult to get compared to traditional mortgages for used homes?

Do you need to own the land outright before getting the loan? If so, is there any way to get around this? Such as doing a lease-option with the owner of the land?

Do they want to see full documentation on the soil, etc before giving out a new construction loan?? What preparation work if any is required before getting a new construction loan?

Is it realistic to assume someone like me, with bad credit.... but $30,000 in cash, could get a new home construction loan for aprox $400k that would take care of ALL expenses (obtain land, permits, do land testing, foundation, building, landscaping, etc) if I think it would all fit well within the budget and it should be worth 700+k when it's finished?

Any help would be appreciated...

Thank you.

Posted by: loanuniverse Nov 24 2004, 12:56 PM
” Is it realistic to assume someone like me, with bad credit..”


This is a consumer loan and two items will come into play.

1- How much money you make and is it enough to repay the loan.

2- Your personal credit.


I am not a consumer/residential lender, but that is what they are going to be looking at. The lender should not approach this as financing for a “spec home” {spec=speculative}.
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