Whether you’re building a whole new structure on a vacant lot or planning a major renovation to an existing building, your construction loan down payment is likely to be one of your major areas of concern if you choose to build a home rather than buy one. But before you dip into your savings for 20% of the expected value of your new home, consider the construction loan options that savvy borrowers can use to their advantage in any market conditions.
Construction Loan Down Payment Assistance
It’s true that down payments for many construction mortgages can be daunting, often requiring you to have sizable reserves of cash on hand when you get to the closing table. But there are government programs intended to help Americans become homeowners by lowering the costs associated with taking out a mortgage. VA construction loans often eliminate down payments entirely, or bring them down significantly, for those eligible veterans who served our country, active military (and their loved ones). The Federal Housing Authority (FHA) and US Department of Agriculture (USDA) also offer low or no down payment options for construction mortgages to qualified applicants.
Each of these programs is often a good deal for our borrowers, helping new homeowners pay less per month on their mortgage in addition to lowering or eliminating their construction loan down payment up front. Whether you opt for a single-close construction loan or refinance after the project is complete, opting for one of these programs can save you thousands or tens of thousands of dollars over the life of your loan!
Your Custom Construction Mortgage Plan
At The Federal Savings Bank, we’re dedicated to helping our borrowers achieve their homeownership goals by helping them eliminate the usual roadblocks. Maybe your credit score isn’t where you want it to be, or you’re looking for a pre-approval for a construction loan with no down payment. A construction loan specialist at The Federal Savings Bank can help you identify all the options available to you, no matter your situation, and can provide you with a no-obligation loan estimate when you dial 877-788-3520 or apply online.
Subject to credit approval. Terms and conditions may apply. Property insurance is required for all loans secured by property.