Father and son cooking in kitchen

Building a Home

Are you ready to Build?

Deciding to build your dream home is a big decision. At Vision Bank, we know how exciting and stressful the process can be. That is why we make the loan process as simple as possible, so you can focus your energy on important things like figuring out tile, brick, cabinets and more.

Choose a Loan Type and Apply

Our Oklahoma-based Mortgage Loan Officers will be happy to help you select the right type of home loan, and you can apply online.

Construction Loan Checklist

  • Full set of construction plans and bids from home builders
  • Description of materials signed by Contractor and Applicant
  • Signed contract between Contractor and Applicant
  • Purchase Agreement for land or Warranty Deed if land is previously owned. If purchased in the last year, verification of purchase price is required

Close on Construction Loan

Closing will take place at a Title Company’s office or with a Vision Bank MLO. Don’t forget to bring a check for any down payment and/or closing costs. When you arrive, you will begin signing various documents including the Closing Disclosure, Promissory Note, and Mortgage. After all the documents are signed and completed you may then begin building the home of your dreams.

Construction Phase

Following the closing of the Construction Loan, you have 12 months to complete your home. You will receive draw requests from your builder. You will submit a signed Construction Advance Form for funds to be transferred to your Construction Checking. Evidence of Builder risk insurance will be required. Regular construction inspections will be conducted during this process to ensure the amount advanced corresponds with the construction progress. You will receive monthly payment notices to reflect the interest amount due. Interest is calculated on the amount of funds advanced.

Permanent Loan

Once your home construction is finished, it’s time to refinance your home construction loan into a permanent loan. Give us a call at (888) 332-5132 to get this process started.

Moving Day

At this point it’s time to move the furniture in!




FAQs About Construction Loans

What kind of loan is best for building a home?

A construction loan provides short-term financing for the costs associated with building a new home. The option to make interest-only payments also makes it more affordable. Once your home is move-in-ready, you can convert your construction loan to a conventional mortgage.

Is a Construction Loan harder to get than a mortgage?

Qualifying for a construction loan may require a larger down payment and more paperwork than a typical mortgage. Construction loans may also carry a higher interest rate as it’s a riskier form of financing than a mortgage on a finished home. If you have questions about your eligibility for a construction loan, just reach out to our mortgage lenders and we’ll be happy to help.

Can you use a construction loan to purchase land to build on?

When building a home, you may already own the land to build on or you may need to purchase a land lot. Construction loans have some flexibility, so talk to our mortgage lenders if you’re looking for a land loan as well.

Is it cheaper to buy or build a house?

The answer depends on your local real estate market and what you’re looking for in a home. Buyers looking for more space or unique features may find it cheaper to build their dream home then try to find it on the market.

How does a construction loan differ from a traditional mortgage? 

A construction loan is a short-term loan used to fund the building of a home. It typically has higher interest rates and is disbursed in stages. A traditional mortgage is a long-term loan used to buy a completed home.

Do I need a down payment for a construction loan? 
Yes, most lenders require a down payment of a certain percentage of the total project cost. In most cases, equity from the proposed building site or other real estate owned can be used to decrease the down payment.
 
What credit score is required for a construction mortgage? 
This varies per lender, though higher scores improve approval chances and loan terms.
 
How can I estimate my monthly mortgage payment? 
You can use an online mortgage calculator by entering the loan amount, interest rate, and loan term.  
 
How are funds disbursed during the construction process? 
Funds are released in stages (draws) based on construction progress. A lender will require a progress inspection before releasing the next portion of funds.
 
Can I use a construction loan to build a second home or vacation home? 
Yes, but it depends on the lender's policies. Some lenders may require a larger down payment or have stricter requirements for non-primary residences.
 
What happens if construction costs exceed my original loan amount? 
You will need to cover the extra costs out-of-pocket or seek additional financing.
 
Do I need builder approval to qualify for a construction loan? 
Yes, lenders typically require you to work with an approved licensed builder. They may review the builder’s credentials, experience, and financial stability.
 
How long does the construction loan approval process take?  
It can take several weeks to a few months, depending on factors like credit approval, builder review, and project appraisal.
 
How can I check the status of my loan? 
 Most lenders provide online portals, phone support, or loan officers to track your loan application and disbursement progress.
 
Apply for a Home Construction Loan Today 
Give us a call at (888) 332-5132 or apply online below to get started on building the home of your dreams. Let Vision Bank be your local mortgage guide!