Barndominium Financing and One-Time Close Construction Loans:

Building a barndominium or barndo can be an exciting adventure, but securing the right financing is crucial. Let's delve into your options, focusing on one-time close loans:

Financing Options:

1. One-Time Close Loans:

• This streamlined option combines construction and permanent financing into a single loan, with one application, one underwriting process, and one set of closing costs.

• Benefits: Simplifies the process, avoids additional closing fees, and typically offers lower long-term interest rates. Interest only payments on funds disbursed

• Drawbacks: Requires more upfront planning and documentation, including detailed construction plans and budgets. 

2. Construction-to-Permanent Loans:

• Similar to one-time close loans, but with separate closing phases for construction and permanent financing.

• Benefits: Offers more flexibility during construction with interest-only payments only on funds disbursed.

• Drawbacks: Involves two sets of closing costs and potentially higher rates for the construction phase.

3. Refinance Construction Loans:

• Pure Funding can refinance a construction loan at time of closing for a conventional/FHA/VA loan with a competitive rate.

• Benefits: Pure Funding can move the loan through process quickly as we would not require any builder/home plan approvals.

• Drawbacks: Requires multiple loan applications, underwriting processes, and closing costs, increasing complexity and cost.

 Barndominium Considerations:

• Lender Specialization: Not all lenders are familiar with barndominium financing. Seek lenders with experience in this niche market. Pure Funding specializes in financing rural properties and in particular barndominiums.

• Down Payment: One-time close loans often require higher down payments (10-20%).  Currently our one-time close construction loans are set at 10%.

• Qualifications: Good credit score, 680+, stable income, and manageable debt-to-income ratio are crucial for securing favorable loan terms.

• Appraisal required would need comparable homes within 5 – 10 miles

• Up to 6 draws

• Fixed price contracts

• 6, 9, 12-month construction terms

• 15 and 30 years on permanent mortgage terms

• No appraisal transfers allowed

• No livestock facilities attached

• 70% of structure to be finished living area

Remember, careful planning and research are key to securing the best financing for your barndominium dream. With the right approach, you can turn your vision into a beautiful and affordable reality.  Contact Pure Funding today to learn how we can help get you into your dream home!