Construction Part 2: General Contractors
Andrew Kudwa
daisies and wildflowers

Building Construction Plans & Contractors 

I left off my last blog talking about the first step when thinking about a construction loan: prequalification. Once you are prequalified, you will need to determine whether to use a general contractor or research and hire your own subcontractors.

1. House Plans: Get your house plans completed as soon as possible. Usually at this point you have gone to a number of Parade of Homes and/or Home Trade Shows in the area to get a feel for what type of home you envision. Will it be a Victorian, two story, ranch, Cape Cod, etc? How many bedrooms and bathrooms are you looking to have? Will you have a walk-out or finished basement? The overwhelming number of choices means that you want to be as prepared as possible on the front end by having a clear vision and communicating that to your architect.

2. Research: It will be up to you to do the proper due diligence on your new builder. Go to your local Home Builders Association and talk to the board members. See who they would recommend and how long they have been working in the area. Do they have a specialty such as green built or log homes? Have an idea of what you want out of a house and that will give you some direction as to who you want to hire. 

3. Communication: I cannot stress this enough. The construction of your home can be one of the most stressful things you ever do, and good communication with your builder can help reduce that stress. If you have a concept in mind, make sure the builder knows exactly what you need. When there is a problem, have an open conversation about changes that you would like, so they are done in the proper sequence and you won’t be charged above and beyond what it normally would have cost you. Good communication with your lender, builder and all related parties is the recipe for a smooth and successful home project

4. Other Ideas: Sometimes it is helpful to take the builder around your current home to point out features that you like or find frustrating. Or perhaps create a “look book” of designs and details that you would prefer.

Once you have your general contractor picked out, you are ready to move on with your loan. You would now need to bring your loan officer the blue prints, dwelling specification and a sworn statement (cost breakdown) to start the appraisal process. You will also want to make sure you have at least 10 percent built in to the financing for cost overruns, since most new home projects encounter unexpected costs.

Leave me a comment with your questions and personal experience and I’ll get back with you promptly. You can also go to for more information.

Related Posts:

Home Construction Lending Series

Construction Part 1: Prequalification

Construction Part 3: DIY/Owner Builder Construction

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