In today’s market, most banks will require a 620 or better FICO score for construction lending. During the height of the mortgage crunch, the score needed was between 680-780 at some institutions, so take steps to repair your credit score (start at www.myfico.com).

 

System Built Lending, one of today’s largest national construction lenders. “It’s harder to get credit approved and harder to get appraisals that come near to covering costs. The good thing is that you can find some fantastic sites at bargain prices and builders are available and more reasonable, too. It really is a good time to be buying and building. Just be sure you can get your financing before you sign any other contracts.”

To get financing for your log-home mortgage, you’ve got to meet five challenges.

1. Find a lender. The first challenge is to find a company that will lend on your construction project. If your log home will be close to where you currently live, you can start with your existing home lender. Even if they say they offer construction lending, getting your loan there may not be a slam dunk; we hear daily stories of couples with great credit scores being turned down for loans above a certain amount. A friend of mine with sterling credit tried to get a simple refinance from a bank he’d done business with for years and found himself