Where there’s a will there’s a way, or so the old saying goes. People who have a dream of building their own home that’s different and unique often need special and unique ways to pay for everything from the materials to the labor to make these dreams come true. If you’re in that position and don’t think you can get the money, you should take heart and read this blog. You’ll find everything that you need to know about construction loans, jumbo home loans and non-conforming home loans right here.
Construction Home Loans Explained
Let’s start off with one of the more common ways to get some cash and that’s the construction home loan. When you’ve got big plans for a place that’s like no other you should at least consider these loans to get your dream up and built. You can’t have your head in the clouds for too long with these construction loans, however, you do need to tell the lenders a story. At least that’s the popular phrase for the detailed timetable you’ll need to have ready to go to get the money from a bank or other lending institution. Being very clear about your plans for the house, whether you’re going to live in it yourself and putting together an exact timetable for building need to be big parts of the story you need to tell to get one of these loans.
Non Conforming Home Loan in a Nutshell
Sometimes, you’ll need a loan that’s as different and unique as your plans for a home and that’s quite often where non-conforming home loans come in. There might be something about your financial status or even the property you want that doesn’t meet the traditional criteria most lenders use, but quite often these loans cover money above conforming mortgage amounts. In all states, that amount for a single family home is $417,000, with the exceptions being Alaska and Hawaii ,where the amount is $625,500.
Keep in mind these are generally very regulated and you’ll usually be paying a much higher rate with this type of loan as opposed to the more traditional variety you can get through the banks. These non-conforming loans fall outside the guidelines established by Fannie Mae and Freddie Mac, the government agencies responsible for establishing them. If you’re looking for this type of loan, it is important to understand there’s a wide range of prices and costs involved and getting some professional help to sort through it all is a good idea.
Well-Rounded Approach with Jumbo Home Loans
To make sure you have a well-rounded approach and all the information you need to make an informed choices, understanding the loans you can apply for when your house in under construction should also include a look at jumbo home loans. These are essentially non-conforming loans as well and you’ll need to accept the fact the interest rates will be much higher here as opposed to the conventional type of mortgage. While building your own unique home is certainly worth the time and effort, you’ll also need to put more away for a down payment if this is the route you want to take.