Navigating the Loan Process for Barndominiums and Land Purchases

Embarking on the journey to purchase a Barndominium or land involves understanding distinct financing processes tailored to each property type. This guide outlines the steps for both Barndominium and land loans, providing clarity to prospective buyers.

Barndominium Loan Process:

  1. Evaluate Your Financial Standing:
    • Credit Score: Ensure your credit score meets the minimum requirement of 660. A higher score can enhance loan terms.
    • Income Documentation: Gather recent pay stubs, tax returns, and bank statements to demonstrate financial stability.
  2. Choose an Experienced Lender:
    • Seek lenders familiar with Barndominium financing. The Kory White Real Estate Group offers access to specialized lenders for unique property types.
  3. Compile Necessary Documentation:
    • Property Details: Provide floor plans, blueprints, and a list of materials.
    • Builder Information: Include contracts and credentials of your chosen builder.
    • Site Information: Detail utilities, access roads, and any existing structures.
  4. Submit Loan Application and Await Approval:
    • Submit a complete loan application with all required documents.
    • The lender will review your application, order an appraisal, and proceed with underwriting.
    • Upon approval, you’ll receive the loan terms and proceed to closing.

Land Loan Process:

  1. Financial Preparation:
    • Credit Score: Aim for a minimum of 660 for purchases and 680 for refinances.
    • Down Payment: Be prepared to make a down payment, typically around 35% of the land’s value.
  2. Identify Suitable Land:
    • Ensure the land has no acreage limitations and aligns with your intended use.
  3. Select a Knowledgeable Lender:
    • Opt for lenders experienced in land loans. The Kory White Real Estate Group can connect you with professionals experienced in land financing.
  4. Gather Necessary Documentation:
    • Financial Records: Recent tax returns, bank statements, and proof of income.
    • Land Details: Survey reports, zoning information, and any environmental assessments.
  5. Submit Loan Application and Processing:
    • Submit your application along with all pertinent documents.
    • The lender will conduct an appraisal and review all information.
    • Upon approval, finalize the loan terms and proceed to closing.

Key Considerations:

  • Loan-to-Value (LTV) Ratios: Both loan types offer up to 65% LTV, meaning you may need to cover the remaining 35% as a down payment.
  • Loan Terms: Both loans offer terms up to 20 years.
  • Prepayment Penalties: There are no prepayment penalties for these loans, allowing flexibility in repayment.

For more detailed information on our loan offerings, please visit our resources:

Navigating the financing process requires careful planning and collaboration with experienced lenders. By following these steps and consulting

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