Question:

Is it possible to get a VA construction loan?

Answer:

VA construction loans are financed by VA lenders on a regular basis. Usually the builder is required to carry the cost of the new construction until the home is completed. If you own the land of the home, the builder may not be willing to carry construction costs and you may need a bridge loan until a permanent VA mortgage is obtained.

VA New Construction Loans vs. Traditional Mortgages

Construction loan terms vary widely. A pure construction home loan will be short-term (6 months to 2 years) and will be replaced by another long-term mortgage upon completion. New home construction loans sometimes have reduced application and loan processing fees.

VA loans allow for no down payment and have a high LTV. Therefore, some banks wouldn't work directly with veterans. A separate interim VA construction mortgage loan will be available for property built by VA approved home builders and through real estate agents specializing in VA construction loans. VA new construction home loans are easier to locate.

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