How to Finance Log Homes
Financing log homes can be more difficult than traditional homes. Borrowers may face stricter guidelines than those applying for conventional mortgages. Log homes are unique and, as such, difficult to establish value for financing purposes. They generally can't be compared with other homes in a neighborhood, which makes lenders uneasy, fearing they might not be able to recoup losses in a foreclosure.
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Instructions
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Obtaining Financing
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Determine if you are buying an existing home or having a log home built. It is generally easier to obtain a mortgage for an existing home. If you are building a log home, you will need a construction loan that can be converted into a traditional mortgage after the home is built.
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Lenders prefer to see a down payment of at least 20 percent. Great credit and steady employment history are musts. Because a log home is considered a greater risk, lenders want to see well-rounded borrowers.
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Check with a large national bank about mortgage products. They often have subsidiary companies, or niche lenders, that specialize in log homes.
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Alternatively, contact a bank that specializes in log home mortgages. If you are having trouble finding one, contact a log home manufacturer.
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