Drmosses- I've represented 12+ builders since 2002 and have marketed lots, new homes, and any combination of these. Here are a few things you WILL come across just driving through new housing developments.
1)Very commonly a builder will hold an inventory of lots which buyers can choose on, and of course build with that builder on those lots.
2)You may come across a model home in a neighborhood where that particular builder is building but does not own any lots in that neighborhood. However the lots in this neighborhood can be reserved to a certain list of builders. More common now that 10 years ago since builders don't have to carry a large number of lots. Many builders went out of business during the downturn of the housing market simply because the cost to carry their lot inventory was too much to bare.
3)This scenario is much more common for acreage parcels, in the general metro area anyway, and these are lots that are simply for sale, you bring your own builder. The lots closer in to the metro are generally tied up by builders and developers with an approved builder list.
Now! Depending on which scenario you come across financing will also vary. Commonly you can find a lot with a builder who will have their own construction financing, you're required to pay earnest money at any variable amount, typically 5%. If you buy a lot and bring a builder you may need to acquire construction financing and taking draws from that loan until final close when you would essentially refinance with a new loan.
There are a lot of variables and I apologize for missing some of the detail. I spend a lot of time searching for lots and work with custom builders so feel freed to bounce any questions off of me that you have :)