Next Step: Obtain Financing for a Construction Project on Bare Land

Building a new home from scratch involves several key steps, particularly when financing is needed. This guide simplifies the process, from evaluating your financial situation to signing a contract with Kimball Construction.

Step 1: Evaluate Your Financial Situation

Start by reviewing your financial health. Check your credit score, determine your budget and down payment capacity, and understand how construction loans differ from traditional mortgages.

Step 2: Choose the Right Type of Loan

Select a loan that fits your needs:

• Construction-Only Loan: Short-term and covers only construction costs.
• Construction-to-Permanent Loan: Converts to a mortgage after construction.
• VA and FHA Loans: Government-backed options for eligible borrowers.

Step 3: Find the Right Lender

Choose a lender experienced in construction loans. Compare interest rates, fees, and terms to find the best deal.

Step 4: Secure Pre-Approval

Getting pre-approved shows sellers and Kimball Construction that you’re serious. It also gives you a clear budget.

Step 5: Make an Offer on the Land

Once pre-approved, make a competitive offer on the land and secure a due diligence period (14-30 days) to conduct inspections and surveys.

Step 6: Prepare Preliminary Plans

During due diligence, work with your architect or Kimball Construction to create initial plans. These plans are crucial for loan approval and getting accurate estimates.

Step 7: Obtain an Estimate from Kimball Construction

Get a detailed estimate from Kimball Construction. Review it carefully and discuss any changes or customizations.

Step 8: Submit Your Loan Application and Finalize Approval

Submit your loan application with all required documents. Once approved, finalize the terms, including interest rates and fees. Funds will be disbursed according to the draw schedule.

Step 9: Close on the Land

Finalize the purchase agreement, pay closing costs, and ensure the deed is in your name.

Step 10: Sign a Contract with Kimball Construction

Finally, close on the construction contract with Kimball Construction. Make sure all terms, timelines, and costs are clearly outlined.

Conclusion

By following these steps, you can smoothly navigate the financing process for building your dream home on bare land, working closely with Kimball Construction to ensure success.