Be sure you don’t put the cart in front of the horse. Understand your finanical picture first so you dream with clarity.

Before you choose a builder or fall in love with a floor plan, there’s one smart step that can make the entire home-building process smoother and far less stressful: understanding your financial starting point. Getting clarity on your budget, your current home’s value, and your financing options gives you the confidence to make wise decisions at every stage. When you begin with a solid financial foundation, you’re able to approach builders and architects with clarity, plan your timing strategically, and avoid costly surprises—setting the stage for a focused, well-guided path to your new home.

Why Financing Comes Before Choosing a Builder

Planning home building budget is an important step to work out once you have talked to your lender and financial advisor and BEFORE you start talking with builders.

Building a home is exciting, but jumping too quickly into design choices or builder conversations can create unnecessary stress later. Financing determines what is realistically possible, how flexible your timeline can be, and which paths are available to you. When you understand your financial boundaries first, every decision that follows becomes clearer and more intentional.

Understanding Your Budget and Home Value Before You Build

The Veenstra Team can provide important information about the market value of your current home. There is no charge or obligation.

A wise first step when considering a new build is understanding the full context of your situation. That starts with clarity around your current financial picture—most importantly, the value of your existing home and how it fits into your overall plan. Knowing this information early allows you to have more productive conversations with lenders and builders and helps eliminate guesswork from the process.

Should You Sell Your Current Home Before Building?

You have lots of choices. The Veenstra Team will guide you to the correct information so you can make wise decisions you are comfortable with.

Many people continue living in their current home while they build, while others choose to sell first and move into temporary housing. Either approach can work well, and the right path depends entirely on your goals, timing, and comfort level. There is no one-size-fits-all answer, and understanding your options early allows you to move forward with confidence instead of pressure.

Construction Loan Options for Homeowners Who Already Own a Home

Watching your new home being built brings a new depth of excitement and joy!

Several construction-loan options allow for short-term financing until your current home sells. These options can provide flexibility and reduce the stress of perfectly timing a sale and a build. Knowing your home’s value is a key factor lenders use to determine what may be available to you, which is why clarity upfront is so important.

The Veenstra Team works closely with trusted local lenders who understand construction loans, bridge-style options, and unique situations. For cash buyers who already have plans or ideas in place, we can also connect you with reputable builders to help ensure the process is smooth, coordinated, and satisfying from start to finish.

Why a Professional Home Valuation Is a Smart First Step

This is where a professional home valuation becomes especially helpful. A valuation gives you real numbers to work with and allows lenders to clearly outline your options. When the time comes to actually list your home, we’ll update that valuation to reflect current market conditions and recent sales, ensuring your strategy stays aligned with reality—not assumptions.

An organized and well planned build starts with clarity and a seasoned team around you.

The Veenstra Team offers home valuations free of charge and without obligation.

Exploring Your Options Without Pressure

It’s okay if you’re just exploring possibilities.
It’s okay if you haven’t committed to taking action.
It’s okay if you’re considering right-sizing your home and want to understand what your options look like.

Our goal is not to steer you toward a particular decision. Our goal is to help you understand your options so you can make wise, well-informed choices that fit your life and priorities.

Honest Guidance—even When the Right Answer Is to Wait

In some cases, after reviewing the numbers and learning more about someone’s goals, we advise homeowners to stay right where they are. Helping someone make a wise decision—even when that decision is to wait—is still meaningful to us.

We’ve found that treating people with respect, listening carefully, sharing our expertise, and being honest about the results of our research is good for everyone involved. God has provided faithfully for us for many years, and because of that, we don’t feel the need to pressure people into decisions. Knowledge brings clarity, and clarity brings peace.

Building a Home in Southwest Michigan: Start With Clarity

If you’re thinking about building a home in Southwest Michigan, the smartest place to start is with clarity—about your finances, your timing, and your options. Whether you’re months away, years away, or simply curious, having the right information early makes every future step easier.

Looking for clarity before you make a decision?

A free home valuation is often the most helpful first step for homeowners who are exploring a new build—even if you’re not sure you’ll move forward. There’s no obligation and no pressure. We’ll help you understand your home’s current value, the market conditions that could affect your timing, and what options may be available based on your goals.

Sometimes that clarity confirms it is the right time to move. Other times, it brings peace of mind that staying put makes the most sense for now. Either outcome is a win.

👉 Schedule Your Free Home Valuation

Increasing Your Fluency Before You Talk With a Lender

Trusted lenders will help you understand the best options for your particular and unique circumstances.

If you’re like many thoughtful homeowners, you may want to do enough research to feel familiar with the language and context before having an important conversation. The information below is designed to do exactly that—nothing more, nothing less.

This is not meant to make you an expert or replace professional advice. We are not lenders, and we intentionally stay in our lane. Our role is to help you understand the landscape well enough to ask good questions and then connect you with trusted lender specialists who meet our standards for customer service, clarity, and guidance.

Fill out the form below and we will provide you with the names and contact info of a few highly trusted building loan lenders.

Think of the sections below as a way to build fluency before discussing your specific situation with a lender who can help you analyze options for building a home in Southwest Michigan.

Using Cash to Build a Home

Some homeowners choose to build using cash, either fully or partially. While this can simplify certain aspects of the process, it still requires thoughtful planning.

Key Considerations When Using Cash

It’s wise to speak with your financial advisor before committing large amounts of cash to a new build. Many advisors recommend keeping at least three to six months of living expenses available, along with funds for near-term maintenance items like a furnace, roof, or major systems.

Opportunity Cost

Using all available cash for a home may limit your ability to invest elsewhere or pursue other long-term goals. Articles from sources like Rocket Mortgage often highlight the importance of weighing the opportunity cost of tying up cash versus maintaining liquidity for retirement or future investments.

Total Cost Awareness

Cash buyers still need to account for the full cost of building, including land, materials, labor, permits, and site work. Closing costs such as title work, surveys, and legal fees, as well as ongoing expenses like taxes, insurance, and utilities, should also be factored in.

Cash Flow Reality

Even without a mortgage, it’s important to ensure your finances aren’t stretched too thin. Leaving room for unexpected expenses and life changes helps protect both your home and your peace of mind.

Construction-to-Permanent Loans

Construction-to-permanent loans are one of the most common financing options for new builds.

How These Loans Work

This option combines construction financing and a long-term mortgage into a single loan. During construction, funds are released to the builder in stages. Once the home is complete, the loan automatically converts into a traditional mortgage.

Benefits

• One closing instead of two, saving time and money

• Interest rate protection against market changes

• A streamlined approval process

Important Considerations

• Typically requires strong credit and a substantial down payment (often 20–25%)

• Interest is paid only on funds drawn during construction

• If you currently own a home with a mortgage, you usually must qualify for both payments during the build

The Veenstra Team can guide you to the right lot and the best builder for your dreams and needs after your financial prep work is done.

Stand-Alone Construction Loans

Stand-alone construction loans separate the building phase from the long-term mortgage.

How These Loans Work

These short-term loans, often lasting 6 to 18 months, cover construction costs only. Once the home is finished, you either secure permanent financing or pay off the construction loan.

Benefits

• Flexibility in choosing your permanent lender

• Potentially lower upfront costs

• Option to pay off the loan with proceeds from selling your current home

Considerations

• Two separate loan applications and closings

• Interest rates may change between phases

• In some situations, there is risk of not qualifying for permanent financing later

Bridge Loans for Building While You Own a Home

Bridge loans are designed for homeowners who want to build or purchase before selling their current home.

How Bridge Loans Work

These short-term loans use your existing home as collateral and help “bridge” the gap between owning two properties at once.

Benefits

• Faster access to funds, often within a few weeks

• Some programs offer no monthly payments during the term

• Flexibility to move forward without waiting for a sale

Considerations

• Higher interest rates than traditional mortgages

• Short repayment timelines, typically 6 to 12 months

• Greater risk if your current home takes longer than expected to sell

Home Equity Financing Options

Home equity can sometimes be used to help fund construction costs.

Home Equity Line of Credit (HELOC)

A HELOC allows you to draw against your home’s equity as needed and pay interest only on what you use.

Cash-Out Refinance

This option refinances your existing mortgage for more than you owe and provides cash that can be used toward construction.

Benefits of Equity-Based Financing

• Often lower interest rates than construction loans

• Flexible access to funds

• Familiarity with your current lender

Considerations

• Your current home becomes part of the risk profile

• May limit borrowing capacity for your new home

• Requires significant existing equity

Alternative Financing Strategies

Some homeowners explore less traditional financing paths.

Owner-Builder Construction Loans

If you plan to act as your own general contractor, certain lenders offer owner-builder loans. These typically require extensive experience, detailed budgets, and well-documented construction plans.

Portfolio Lenders

Some banks keep loans in-house rather than selling them on the secondary market. This can allow for more flexibility in unique situations, such as owning a home while building another.

Private and Hard Money Lenders

Private lenders may offer faster approvals and fewer restrictions, but often at higher interest rates and shorter terms. These options are usually considered when traditional financing isn’t available.

Building a Home in Southwest Michigan: The Value of the Right Team

Every financing path has trade-offs, and the right option depends on your goals, timeline, risk tolerance, and overall financial picture. This is where having the right professionals around you matters.

For homeowners building a home in Southwest Michigan, the Veenstra Team helps you start with clarity—connecting you with trusted local lenders, experienced builders, and reliable information so you can move forward with confidence rather than pressure.

You don’t need to have all the answers today. You just need a clear place to start.

Schedule your Free, No Obligation Home Valuation with the Veenstra Team.