About Building a New Home

If you are thinking of building a new home, you might be making a wise decision. Building your own home allows you to control several aspects of the construction process. You can choose what your home looks like, where and how large the rooms are, and where the home is located. In some cases, you can even save money over buying an existing home.

Finding Land

You have to find land to build a new home. Land is for sale just like homes are for sale. You'll want to look under the Lots or Land for Sale sections of newspapers or magazines that list homes for sale, or talk to a local real estate agent. When you find a piece of land you want to build on, you can purchase it just like a home.

Building Permits

You will have to get permits for the home you want to build. Home plans must generally be approved by the town or city where you live. Usually the lots for sale are approved for certain sized homes. If you are buying land in a subdivision, the land has already had soil tests conducted, which is required for septic system installations and in some cases engineering purposes. If soil tests have not been done, you need to contact a soil tester and have one performed. If the lot has a town sewer or water connection, soil testing is not necessary.

Designing the Home

For the best results, you should contact a professional architect to design your home. However, you can also take rough ideas to a building contractor, who can then work with an architect to draft the plans. Builders have a lot of experience working with homeowners, so they can guide you through this process. They can help interpret your ideas and also show you several pre-drawn plans that you might like.

Working With a Builder

Working with the contractor may be the toughest part about building a home. To find a good contractor, check with people who live in your area for references. Ask to see photos of work that the contractors have completed. Also ask them for references, and call those people. Find out from the contractors what other jobs they might have going on besides your home. You will want to know if the contractor you choose has enough subcontractors available to complete your work on time.

Financing

Financing your new home is done through a construction loan with a bank or other lender. The financing process is similar to buying an existing home, though rates are often different. Lenders also ask for collateral on the loan since the home is not built yet, and there is no collateral as there would be for a loan on an existing home. You need to secure your construction loan before a contractor will begin to build. Once the home is built, it becomes your collateral. You will pay off the construction loan, and take out a mortgage for a regular home loan.

Resources

• About Building a Home
• Cost Estimates
• Construction Loans