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Building a Custom Home: Step 2 - Setting a Budget and the Preapproval Process

Gerard Construction has experience in every component of the home building process and financing is no exception to that. In fact, our team is uniquely poised to walk alongside our customers through the process of researching and securing financing for their new custom build home.

Michael Patranella spent over 24 years in banking in the Brazos Valley before founding Gerard Construction. Those years of experience help the team at Gerard to understand the three facets of financing, the construction side, the lending side, and the customer’s side. By sharing the knowledge gained over his time in banking, new homeowners can count on a relationship that is built with trust and care.

Here are the factors to consider when setting a budget and securing financing:

     1. Think about what you want. While you will need to lean on the assistance of experts, you also need to think about what you want from a new build. Designing and building a starter home is very different from building an expansive estate in the country. By knowing a few options of what you are looking for, it will be easier to narrow down your financing needs.

     2. Consider the entire build. When planning a new home build, you want to think about the entire process. Splitting the budget between purchasing land, the structural build of the home, and the details within the home will need to be thought out ahead of time. That being said, you can’t compromise on some parts of the build. The foundation is pretty important and so is the safety of the home!

     3. Speak with your banker. Your banker can begin to give you a rough estimate of what the lending climate is currently. They probably have access to a number of your financial records and if you have outside money or accounts, they can factor that in. While it would take longer to give exact figures, you can at least get a feel for the economics.

     4. Banking recommendations. If you don’t have a banker that you know and trust, give us a call. We have a number of associates and contacts that we feel comfortable recommending to you. Make sure your banker knows you are building a home. The lending process is a bit different for a construction loan than a conventional mortgage.

     5. More thinking. Now that you have a pulse on the economic side and what you may want to consider, you can probably narrow in a little closer to what you want from your home build. Some families may consider waiting a bit longer, others may realize they can actually scale up their plans. Every scenario is as different as the home you will one day build.

     6. Contact us. If you haven’t already, give us a call. We can meet with you to begin going over some rough estimates and timelines, all important information that your lender will want to know. During this time, the process is very fluid, you can adjust or alter your plans based on any of these conversations.

     7. Meet with your lender. If you haven’t already settled on a bank or lender you have an established relationship with, now is the time. It is important to choose someone you know and trust, it is our top piece of advice for the lending process. While you cannot guarantee that your loan won’t be sold to someone else down the road, you want a group you can partner with during the actual home building process.

Many people hesitate to custom build their own home, but homes come in every shape and size and fall within every budget. Our job is to work with a homeowner to make a plan that fits within their constraints and meets their dreams. Just like buying a home through a conventional process, you have to clearly communicate what your needs are and what your budget is and stick with the homes that fall in the middle. With a home build, you will have to put a larger investment down, but it will be well worth it in the end. Our team knows that a home is important for every family, not only do we partner with trustworthy lenders, but we will give you an honest estimate and our best work.

Our team at Gerard Construction can assist with every step in the home building process, from land acquisition and financing to every detail in every nook of your home being built perfectly. To learn more about our team and the services we provide, contact us today.

View our project gallery to see our latest custom home builing and remodeling projects. More