Does the VA have loans for new construction. (To build a house)

VA does not do construction loans.. if you're dealing with a new home subdivision, then usually you just give a deposit, and 6 months later when the home is built, you apply for a mortgage to purchase the home.. Under this scenario, you can use VA for your financing.. if you wish to build a Custom home.. Then the builder would have to fund the construction out of his own funds, and then sell it to you upon completion for you to use VA.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

This is what my resident VA expert had to say. Does this work for you?My best advice is to work with a builder to have him build the home out of pocket in partnership with the buyer and the VA buyer would purchase upon inspection... the builder must be approved to build home that is VA eligible

The simple answer is that VA does not offer loan to construct a home- however what Paul said is the best way to get a VA loan on a new construction home. You want to work with a builder that is self funded in a larger development so that they can build the home for you and you can secure the home with a VA loan once it is built and you can obtain a certificate of occupancy. Very important that the builder is certified to be able to build for a VA loan- they must have VA approval and other VA credentials which the builder will be aware of when you mention that you are attempting to use a VA mortgage loan. good luck!

There are some specific guidelines for Minimum Property Requirements in the VA Home manual, particularly in the chapter found:http://www.benefits.va.gov/WARMS/docs/admin26/pamphlet/pam26_7/ch12.docThere is nothing regarding requirement for one or two story home, nor for specific number of bedrooms.Hopefully this is helpful.

If you are going to have the construction done for you, and use a VA loan to fund the house -- there are actually several additional VA inspections that would normally be required during the process of construction. Please see the VA requirements at:http://www.benefits.va.gov/WARMS/docs/admin26/pamphlet/pam26_7/ch14.docIn conformity with the other responses, VA does not do "construction loans" in that they do not provide temporary funding that is converted to permanent funding upon completion (with draws along the way.) You would want to find a lender who does the financing of such construction loans, if the builder is not fully self funded. You would also want to speak to lender early in the process to be sure that you meet all the financing requirements - before you get into the process.

I've had this question at least 3 times in the past couple months... Other than what is effectively "take out financing" as described by others above, the answer is no. (Mainly because a construction loan is considered much more risky than a purchase mortgage. Also, VA will not guarantee the loan until the home is completed, and because the loan is 100% financing there is too much risk to the lender.) You would need a separate loan to construct the home. Most construction-permanent loans available will finance a maximum of 80-90% of the value of the home. We have a loan that could be applied for by the contractor but most likely it would be for 65-70% of the home value.