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Your credit rating Prequalifying for a loan

In case you're wondering how this all works, lenders use certain (qualifying) formulas to tell how much you can afford.
All this is explained in our section on developing your budget. Every lender will have slightly different rules for home building loans, some of which may be more stringent for Owner Builders.

The lender wants to cover his behind. If you're going to be an Owner Builder, he'll not only want to know that you can repay the loan, but equally (or even more) importantly - that you can successfully carry it off (the Builder part), before committing to a home building loan.

Once you're qualified for the permanent financing, you can get to the particulars of the construction loan. Click here to find out more, including sources of home construction loans, what you should know about appraisers and appraisals, the cost of the loan, about 100% financing, and more.

So where do you start looking for the money? Many of you will already have banking connections. Perhaps you already have a home loan. Maybe you've even had a home built for you.

If so, you know where to start. If this is your first time, not to worry. Remember, one out of every ten homes built in this country are owner built! So there are a lot of lenders out there looking for your business.

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