• Home
  • Military
  • Can I buy a new construction with a VA loan?

Can I buy a new construction with a VA loan?

The short answer is yes, you can build your dream home with a VA Home Loan. However, it is hard for VA borrowers to find a lender willing to issue a $0 down construction loan. After the housing market collapse, many home builders became extremely cautious of selling houses to borrowers with little to no money down. 

Because of this, qualified veterans usually have to jump through another hoop to use their VA loan by receiving a short-term loan from the builder or local lending institution and then refinancing it into a permanent VA mortgage. Unfortunately, these construction loans usually require a down payment, which nullifies one of the greatest benefits of a VA loan.
As for requirements on the VA side, the brand new home must have a VA appraisal, the builders must be able to obtain a VA Builder ID, and builders must provide a one-year warranty on the home. 
This all sounds like a lot of hassle, however, if you work with KNE Realty, you don’t have to worry about large home building companies dashing your dream home hopes. Because of our relationships with home builders in the Southeastern Michigan area, we can direct you to VA-friendly builders who have a track record of building homes for veterans with a VA Home Loan.


You can use the VA loan to build a home yourself, too. The VA lender simply treats the veteran as the general contractor in such a case.