Wyoming Construction Loans
Wyoming loans for home construction offer flexibility and provide unique terms that make them more appealing to people who want to build custom homes versus buying existing homes. Our loan calculator can help you explore how much your loan will cost monthly in Wyoming.
A Primer on Construction Loans
Construction loans differ from traditional loans since they provide funding in multiple stages. You can expect to pay just interest until you complete your project.
One-Time versus Two-Time Close Lending Options
One-Time Choice
This loan is a mixture of a permanent mortgage and a construction loan and allows you to initially secure your desired interest rate, offering financial predictability. The process is streamlined since it involves completing a single application and paying closing costs only once. Your initial rate may be higher than what homebuyers receive with two-time Wyoming home construction loans, though, and you might find it more challenging to change your lender or loan terms once construction begins.
Two-Time Choice
This Wyoming new construction loan features two loans with two closings: The first loan covers your construction phase, while the second covers your mortgage. The benefit of this loan option is you may receive a lower mortgage rate depending on the market and can more easily shop around for the best rate. Unfortunately, you’ll have to pay closing costs and obtain a lender’s approval not once but twice. The interest rate may also be volatile, and you might not be eligible for a permanent mortgage despite qualifying for a home construction loan in Wyoming.
Construction Loan Calculations
You must complete several steps to calculate your construction loan. Start by working with a builder to produce a budget that accounts for unforeseen expenses, permit costs, labor expenses, and material costs. Next, hire a home appraiser to generate a detailed home appraisal highlighting your home’s value.
Finally, determine your ratio of loan to value. If your residential construction phase will cost you $300,000 and your home’s appraised value is $400,000, you may receive a $240,000 loan if your lender offers financing up to 80%.
Getting a Residential Construction Loan
Several steps can help you secure the right Wyoming new construction loan for your needs. First, make sure your ratio of debt to earnings and credit score are strong since Wyoming home construction loans are typically higher risk in lenders’ eyes, meaning lenders will be stricter regarding these standards. Second, pick a dependable builder whom your lender will have no problem approving.
Next, create a comprehensive architectural plan and speak with Summit Lending about construction loan options and rates. You can then provide your lender with your financial data, appraisal, budget, and architectural plan. The final step includes finalizing your Wyoming new construction loan, once or twice depending on your loan option.
Slashing Your Mortgage Payments
You can drive down your monthly mortgage payments in a few ways. These include shopping around for the best interest rates, picking a longer mortgage term (e.g., 30 years versus), and paying a larger amount down.
Get Expert Guidance From Summit Lending Today
At Summit Lending, we’re excited to offer Wyoming home construction loans to help you realize your dream of building a custom home. Let us help you find a loan that will enable you to build a house tailored to your preferences and needs in Wyoming today!
