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Home Construction and Lots

Make Your Dream a Reality

Let the knowledgeable, friendly lenders at National Exchange Bank & Trust help make building your dream home a real possibility.

  • Locally serviced loan partnering with local title companies for inspections and draw requests

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Home Construction Loan FAQs

Considering building a home is as exciting as it is daunting. Let us take a few a worries off your mind with these questions and answer. If you need more help, feel free to contact your local lender with any questions you may have. That’s what we are here for!

How much money do I need to put down?

A standard 20% of the value of the project is preferred to be injected into the transaction.

Do I have to bring my down payment to closing?

The details of your transaction will determine how the bank receives your down payment funds. If cash from you at closing is required, those funds will be expected at closing and will be put into an escrow account. All borrower contributed funds in the escrow account will be exhausted before draws on a loan take place to fund the the construction project.

What value is used to determine the down payment requirement?

The cost of the project and the appraised value are taken into consideration, and the higher of the two is used to calculate down payment.

What documentation will you need from me in order to complete a construction application?

In addition to the standard income, asset and liability information collected on a loan application, you will also need to provide the plans and specs for the build along with a cost breakdown for the project.

I own the land that the house will be built on free and clear. Can that be used as part of my down payment?

Yes. The value of owned land, minus any liens against the land, can be used as equity in the project.

Can I use my own builder/contractor for the project?

NEBAT maintains an extensive list of certified contractors who are approved for new home constructions projects with NEBAT. Please talk with your lender to see if your preferred builder is on our list.

Can I be the general contractor on the construction of my home?

Several factors are taken into consideration when deciding if a borrower can be their own general contractor on a project. A conversation with your lender will determine eligibility.

Who will handle the construction draws to pay the bills?

The title company involved in the transaction is the preferred agent to handle the construction draws and monitor the progress of the build.

Online Loan Applications

To help the government fight the funding of terrorism and money-laundering activities, federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account. What does this mean for you? When you open your account, we may ask for your name, address, date of birth and other information that will allow us to identify you. We may also ask for your driver’s license information or other identifying documents.

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