As an alternative, you can use a renovation loan to purchase an existing home with "good bones" or in the perfect location / neighborhood. With the builder of your choice you can completely remodel the property. You can gut the house then replace it with your own kitchen with customized cabinets, use high end appliances,and install marble countertops. You can redesign the rooms and add another bath. You can add a porch or garage. You can even add a whole second floor. This is great option for building your dream home in an already established neighborhood. You only need 3.5% down with the FHA 203K version of a Reno loan. Check this option out.
Cash requirements for a true construction loan are higher than a traditional purchase. I would talk to a few lenders as they vary considerably. I would also see if you can find a builder who may build a home on spec for you where you can obtain a traditional home loan and close at the end of construction. The answer to this question is going to depend on many variables.
The answer cannot be handled here in this little answer box.
I would use a search engine for the next few months searching for builder horror stories.
Take notes, learn from the problems others ran into.
Then take all your notes and info, choose an experienced local real estate professional and choose a local attorney who has experience with buying new construction from builders.
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