New Construction Home Loans Michigan
Finance your new construction home with a single-close construction-to-permanent loan. Lock your rate before breaking ground and convert to a traditional mortgage at completion.
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New Construction Loans in Michigan
Buying a newly constructed home in Michigan involves a different mortgage process than purchasing an existing home. Depending on whether the builder has already completed the home or you are building from the ground up, you may need a standard purchase loan, a construction-to-permanent loan, or a builder-specific financing arrangement. Understanding your options before you sign a purchase agreement can save you significant time and money.
Completed New Construction vs. Build-to-Order
If the builder has already completed the home (a "spec home" or "move-in ready" new construction), the mortgage process is nearly identical to buying an existing home. You apply for a standard purchase loan, the home is appraised based on its completed value, and you close when the home is ready. The main difference is that new construction appraisals are based on comparable sales and the home's specifications, and the timeline is subject to the builder's completion schedule rather than a standard 30-45 day closing window.
Construction-to-Permanent Loans
If you are building a custom home on your own lot, a construction-to-permanent loan (also called a "one-time close" or "single-close" construction loan) finances both the construction phase and the permanent mortgage in a single loan. During construction, you make interest-only payments on the funds drawn. When construction is complete, the loan automatically converts to a permanent mortgage — typically a 30-year fixed — without requiring a second closing. This eliminates the risk of rate changes between the construction phase and the permanent financing phase.
Builder Financing vs. Independent Lender
Many Michigan builders offer in-house financing or have preferred lender relationships. Builder financing can come with incentives like closing cost credits or rate buydowns, but it is important to compare the full terms — including the interest rate, closing costs, and loan structure — against what an independent mortgage broker can offer. In many cases, the incentive is priced into the purchase agreement, and an independent lender may offer better overall terms even without the builder's credit.
Frequently Asked Questions
Do I need a special loan for new construction in Michigan?
It depends on the stage of construction. For completed new homes, a standard purchase loan works. For homes still being built, you may need a construction-to-permanent loan. Your loan officer will identify the right structure based on your specific situation.
What is a construction-to-permanent loan?
A construction-to-permanent loan (also called a single-close or one-time close loan) finances both the construction phase and the permanent mortgage in one loan. It eliminates the need for two separate closings and protects you from rate changes during the build period.
Can I use FHA or VA for new construction?
Yes. FHA and VA loans are available for new construction, though the process and requirements differ slightly from standard purchase loans. VA construction-to-permanent loans are particularly valuable for eligible veterans building a custom home.
Should I use the builder's preferred lender?
Builder financing incentives can be valuable, but you should always compare the full loan terms — rate, closing costs, and structure — against what an independent mortgage broker can offer. In many cases, an independent lender provides better overall terms even without the builder's credit.
Why Michigan Mortgage Solutions?
We've been helping Michigan families achieve homeownership since 1999. Here's what sets us apart.
Practice Purchase™ System
Our exclusive process lets you simulate your mortgage before you commit, no risk, no hard credit pull.
Expert Team of 5 Loan Officers
From first-time buyers to seasoned investors, our specialists match you with the right expert for your situation.
Same-Day Approvals Available
Get a verified pre-approval letter the same day in many cases, so you can make competitive offers with confidence.
Access to 50+ Lenders
As a broker, we shop your loan across dozens of lenders to find the best rate and terms, not just one bank's products.
Specialty & Hard-to-Place Loans
Self-employed? Low credit? High DTI? ITIN? We have programs for borrowers other lenders turn away.
Step-by-Step Guidance
We guide you from first conversation to closing day, no guesswork, no surprises, just clear communication.
What Our Clients Are Saying
275+ five-star reviews from homebuyers, homeowners, and investors across Michigan.
"Trevor and the team at Michigan Mortgage Solutions made buying our first home so easy. They walked us through every step and got us a rate we couldn't believe. Highly recommend!"
"I was self-employed and thought getting a mortgage would be a nightmare. Jason found us a bank statement loan that worked perfectly. Closed in 28 days!"
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