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3 Things to Know About Funding Your Dream Home


For most people, figuring out how to buy a home can be complicated and confusing. If these emotions resonate with you, then rest assured you’re not alone.

Photo of a family building a house

In fact, one survey found 40% of Americans felt buying a new home is the most stressful event in modern life. Another 30% were reduced to tears during the home buying experience.

If you’re thinking about building your dream house, that process can have additional hurdles. Here’s what you should know about paying for a custom built home.

You may need two loans.

When you buy a pre-built house, you’ll need one mortgage to pay for the home — that means one application, one qualification process and one loan.

But people building a custom home usually need to pay for multiple things: the construction materials, the builder for the construction and the home’s permanent financing.

Most mortgage lenders require a loan for the construction and then a separate loan for the permanent mortgage, resulting in a mountain of paperwork and complicated budgeting for would-be homebuilders.

At WaFd Bank, we finance custom construction homes differently. Our All-in-One Construction Loan is just that — it’s one loan for the materials, construction and permanent financing — ultimately saving you time and money with one loan, one set of documents, and one closing fee.

You might need a second appraisal or re-qualification after construction.

Because most lenders require two loans, many borrowers are stuck needing a second appraisal or going through the qualification process again after construction is complete in order to receive permanent financing.  With us, you won’t need a second appraisal or re-qualification for permanent financing after construction is complete.

Your interest rate could change partway through your build.


Another drawback of applying for multiple loans? You could end up paying a higher interest rate for the permanent financing of your home. At WaFd Bank, we lock your interest rate for construction and permanent financing at the beginning, so you’ll know exactly how much you’ll pay each month for your mortgage.*

We’re here to help.

If you’re thinking about buying a lot or building a home, our neighborhood loan officers are here to help. Our local branch teams manage the process from start to finish, including the loan application, processing of your construction financing, to the management of construction draws as you build. In fact, we don’t sell our loans; we’ll continue to hold and service your loan, so you’ll always with work us.

Click here to find your local loan officer.

Loans subject to credit and underwriting approval.
*Assumes fixed rate, all in one custom construction mortgage.

Have Questions?

Your neighborhood loan officer is here to help.

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