Cheyenne has long been home to active-duty service members, military families, and veterans. For many, it also offers an opportunity to build a permanent home after years of relocating.
If you’re considering building a custom home, you may be wondering whether your VA home loan benefits can help finance new construction. The answer is yes: eligible veterans, active-duty service members, and certain surviving spouses may qualify for a VA construction loan, allowing them to build a custom home rather than purchasing an existing property.
If you’re planning to build with a VA loan, knowing what to expect before you get started can save you a lot of time and answer a lot of questions. In this blog, we cover those basics of building a custom home in Cheyenne with a VA loan and what you can expect throughout the process.
Can You Use a VA Loan to Build a House?
Yes you can! Eligible veterans, active-duty service members, and certain surviving spouses can use a VA construction loan to finance the construction of a new home. Depending on the lender and loan program, you may also be able to finance the purchase of your land.
Because construction loans involve additional planning, underwriting, and inspections, not every lender offers this type of financing. It’s important to find a lender that has experience with VA construction loans, along with a builder who understands the requirements and documentation involved throughout the construction process.
Understanding the VA Construction Loan Process in Cheyenne, WY
Building a custom home with a VA construction loan involves more planning than purchasing an existing home, but understanding the process ahead of time can make it much easier to navigate.
1. Determine Your Budget and Loan Eligibility
The first step is speaking with a VA-approved lender to understand your financing options. During this conversation, the lender will review your income, assets, debt, credit, and military eligibility to determine how much you qualify to borrow.
This is also the time to understand your estimated monthly payment, closing costs, and any cash you’ll need to have available before construction begins. Because VA construction loans have additional requirements, qualifying can be more involved than a traditional mortgage, so you’ll want to understand your financial picture early in the process.
2. Find the Right Homesite
Once you have a clear understanding of your budget, you can begin searching for land if you don’t own land already. Work with a local real estate agent to find a property that fits your goals for your home and your budget. Remember that the location plays a role in the overall cost of the project. Factors like excavation, utilities, and other site prep requirements can all affect construction costs, so it’s a great idea to even involve your builder while evaluating potential properties.
3. Choose A Qualified Builder
Not every builder has experience working with VA loans, so it’s important to choose a licensed and insured local builder who understands the requirements involved. As you evaluate builders, meet with them, look at their online reviews, and ask them about past clients or past projects involving VA construction loans. This can give you valuable insight into their quality of work and their familiarity with the VA loan process. If you haven’t quite settled on land yet at this stage, you can even ask your builder for help evaluating the site conditions, utility availability, or other factors that would affect construction costs before you purchase it.
4. Begin the Design Process
Once you’ve found your land and chosen your builder, you’ll begin working with that builder to design your home and establish a construction budget. Your builder will develop the home plans, prepare a detailed construction proposal, and identify the site-specific work that will be required based on the property. Throughout this stage, you, your builder, and your lender will work simultaneously to make sure the project aligns with your approved budget and financing.
5. Finalize the Project and Close on the Loan
With your land secured and the details of your home finalized, the lender can move forward with underwriting. At this stage, you’ll typically have:
- A signed land contract or proof of land ownership
- A signed construction contract
- Finalized home plans
- A detailed construction budget
A lender will then complete underwriting, order the appraisal based on the proposed home, and issue final loan approval. Once everything has been approved, you’ll close on the construction loan. Rather than receiving all of the funds upfront, the money is held by the lender and released to the builder through scheduled construction draws as the work progresses.
6. Complete Construction and Transition to Your Mortgage
After construction is complete and all finalized inspections have been completed, the loan goes through a modification process where it moves from a construction loan into your permanent mortgage.
One of the great advantages of many VA construction loan programs is that borrowers generally don’t begin making regular mortgage payments until their new home is complete and they’re ready to move in!
The Benefits of Building with a VA Construction Loan
Depending on the lender and loan program, a VA construction loan can offer several advantages over traditional construction financing, including:
- One closing instead of two. With a one-time-close VA construction loan, you’ll only go through the closing process once, helping reduce closing costs and paperwork
- Finance up to 100% of the project. Eligible borrowers may be able to finance both the land and construction with no down payment
- One loan approval. Once approved, you won’t need to apply for a second mortgage after construction is complete, provided all final inspections and loan conditions are met
- No private mortgage insurance (PMI). Unlike many conventional loan programs, VA loans do not require PMI, which can lower your monthly housing costs
Benefits vary by lender and loan program. For more information on the VA One-Time Close Construction Loan offered by Veterans Lending Group, reach out to Angel Stratton-Busek, a licensed loan officer for Cheyenne, WY.
Why More Veterans are Choosing to Build in Cheyenne
While existing homes are always an option, building offers great advantages, especially for military families planning to stay long term.
You Can Design a Home That Fits Your Needs and Lifestyle
Instead of compromising on an older home, you can build around your family’s needs. This might include a home office, larger garages for vehicles and outdoor equipment, accessible layouts for aging in place, and even energy-efficient features to reduce long-term utility costs.
If you own land and are ready to build, Homestead Home Builders can help you navigate the design process for a custom home while working with you and your lender throughout the process. With several projects underway in Cheyenne, including a custom home being built with a VA construction loan, we understand the coordination required for a streamlined build. Contact us today for a consultation!
Have More Land and Room to Grow
Many of the surrounding communities near Cheyenne offer larger homesites than you’ll typically find in established neighborhoods or in Northern Colorado. For veterans leaving military housing, the opportunity to own acreage or simply enjoy more privacy is a major advantage!
New Construction Means Less Maintenance
Older homes often come with aging roofs, HVAC systems, plumbing, and electrical. With a custom home, everything is brand new and built to current building codes, reducing maintenance costs during your first several years of ownership.
Choosing the Right Builder Matters
Not every custom home builder in Cheyenne, WY has experience working with VA construction loans. A builder familiar with the process understands:
- Construction draw schedules
- Required inspections
- Documentation lenders request
- Budget planning
- Building within lender timelines
At Homestead, we’re currently working on a custom home project in Cheyenne using a VA construction loan, giving us firsthand experience with the coordination required between the homeowner, lender, and builder. If you’re considering building with VA financing, ask us about our current projects local to Cheyenne and how our experience with these loans can help guide your custom home project.
Find out if building with a VA loan is right for you.
If you’re planning to make Cheyenne your permanent home, building can be an excellent way to maximize your VA benefits while creating a home designed perfectly for you and your loved ones. Instead of settling for an existing floor plan, investing in a large renovation, or compromising with a manufactured home, you can start with a home built around your needs from day one.
Whether you’re transitioning out of military service, retiring from F.E. Warren Air Force Base, or simply ready to build your forever home, understanding how VA construction financing works is the first step toward turning your plans into reality.
To learn more about building with a VA loan, see our current projects in Cheyenne, WY, or discover what’s possible on your land, please reach out to us online or give us a call at 970.775.3796.
Homestead Home Builders is a custom home builder in Loveland, Colorado, serving the Northern Colorado Front Range and Cheyenne, Wyoming. We work with clients building custom homes that may be financed through VA construction loans, but we are not a lender. The information in this blog is provided for general educational purposes—loan eligibility, terms, and available financing options vary by lender and borrower. For more information, schedule a consultation with our team to discuss your project!