Construction Loans in Prosper Texas
Have you ever walked into a model home and thought about how things would look with higher ceilings, a larger entry way, more windows perhaps?
New home construction is on its way back; it has been for the last few years. The market is beginning to reach higher and higher as buyers begin to come back and sellers phase out. While these homes are ruggedly built and have some serious curb appeal, they tend to mirror one another more often than not.
Buying an older home takes some of the “cookie cutter” stigmas out of purchasing an existing home, but there is still the thought at the back of your of mind: “I would have built this a little differently.”
Taking an idea from paper to foundation, from foundation to drywall, and onto whatever your desired exterior substrate of choice be, can be a highly creative process bringing out the inner architect in all of us. However, trying to secure funding for the construction of your dream home can be a nightmare.
How do I get a construction loan in Texas?
There are several aspects that need be considered prior to applying for a construction loan. First and foremost is the land that it is to be built upon. Lenders tend to require larger down payments from those that do not already own the land that wishes to build on, to the tune of 20% to 30% of the loan amount. Additionally, lenders will require that the value of your soon to be built dream home be estimated by a licensed appraiser, who gathers information about the local market and similar homes in the area in the conduction of his evaluation.
Construction loans typically carry adjustable rates and can be transferred into long-term loans. In fact, they should be transferred to a different type of loan as soon as you are able, the interest rates tend to be a little higher than a typical 30 year fixed rate mortgage.