Everyone’s probably heard of a VA Home Loan before. But did you know that the Department of Veterans Affairs also offers a VA Construction Loan?
We’re proud to say that Georgetown Mortgage is one of only a few lenders in Texas to offer VA Construction Loans. For your convenience, here’s a brief description of the VA Construction Loan program.
Benefits and Eligibility
For starters, these loans allow veterans and their spouses to build homes with no money down. Moreover, the interest rates that come with the program are often better than those on traditional construction loans.
To be eligible for a VA Construction Loan you must be a veteran, active duty member, National Guardsman or Reservist. Certain spouses of deceased service members may also be eligible. As with a VA home loan, those applying for a VA Construction loan must have a certificate of eligibility and fill out a VA application form.
How It Works
The loan is closed before the construction of the house begins. The initial disbursement of funds pays for the property where the home will be built. The rest goes into an escrow account from which the builder is paid.
Unlike a traditional home loan, you won’t start paying off the loan until the construction is complete. That unpaid time will be added to your adjusted monthly mortgage payments over the remaining life of the loan.
We recommend anticipating this unpaid time by making monthly “mortgage payments” into a savings account while construction is ongoing. That way, when the amount for the unpaid time comes due, you’ll easily be able to make your payments.
Give Us A Call