My wife and I are in the process of trying to decide if it is better to build or buy a pre existing home. In our daily debate we are leaning more towards building a home here in Texas, but are unsure of what loans will allow for builders in subdivisions to build. Is there any different in the type of loan needed to have the house built? We will be first time home buyers with a combine income of 166,000 a year. Our scores are borderline between FHA and Conventional area. Which would be the easiest to to have a home built? Any input would greatly be appreciated.
It sounds like you are talking about building a new home in a new build subdivision, not building a home on a piece of land of your own, also known as a "construction loan", right?
Personally, I think think getting a loan on a new build home is easier than a loan for a pre-existing home. I've seen this mentioned online and the logic is that if you go with the builder's lender, they are more vested interest in getting the loan done (they want to sell the house and they also want to do the loan, so they win on two ends). As for the type off loan, he same exist for either type off home...FHA, Conventional, VA and they have the same requirements.
Aside from the loan aspect, I think going with a new home can't be beat. Not only is it new, with a warranty, but you get to customize the home for your needs and you are part of the construction process, you see the home go up which is a great experience in itself.
Construction lending as a bit different.
It is a high credit score deal.....
Do you own the lot? Can you buy the lot?
typically, in a subdivision, the guy building homes there ownes all of the land.... I have never seen anyone buy a lot and bring in their own builder....
the guy who owns the land wants to sell all of his houses.... they would be ver concerned with another builder in their sandbox. What if the guy you hire builds a substandard home and drags down the average price? You see?
We are building in Texas, DFW area. You get less home for the money when you build new, but you get it the way you want it.
With your high income, if you go FHA you wont be able to get as much of a home because of the loan limits. In Texas the limits are too low.
Your probably wanna go conventional if you have the score and want a nicer home.