Skip to main content
search

Construction Loans in Missouri

Personal construction loans are a particular type of financing used to fund custom home-building projects. Although constructing your dream home can feel overwhelming, the Bank of Old Monroe is here to help. Our experienced lending team can assist you with a flexible construction loan in Missouri suited to your needs.

Our community bank has helped families finance what’s important to them since 1906, and we’ll do the same for you. Contact our expert lenders to begin the process of building your dream home!

Contact Us Today
Construction loans in Missouri | New construction of a home | Bank of Old Monroe

Loan Officers

What Are Construction Loans?

Construction loans are short-term, fixed-rate personal loans that cover the costs of building a new home.

How Do Home Construction Loans Work?

Borrowers can draw from the loan based on the construction project’s stages. For example, when the contractor completes your home’s foundation, our bank provides the funds for the next construction phase. You then only pay interest on the amount disbursed as the project progresses.

During the process, we will visit the construction site to monitor progress based on the timeline.

Construction loans in Missouri typically cover the following items:

  • Cost of land
  • Materials
  • Contractor labor
  • Permits

The Bank of Old Monroe’s lending team ensures you understand the personal construction loan process and your responsibilities. When the builders finish your home, we’re here to help you choose the competitive permanent financing option that best suits your financial situation.

Benefits of Construction Loans

Home construction loans come with several notable advantages. First, they offer flexibility during the building process. Unlike a single lump-sum payment, these loans disburse funds in stages, allowing for project adjustments or changes.

Construction loans are a cost effective lending option. Interest is charged on the amount disbursed, so you only pay for what you use. This unique feature can significantly lower the overall cost of your project.

The Bank of Old Monroe provides competitive rates, making your dream home more affordable. Our lending team works closely with you to ensure details of the loan are clear prior to proceeding.

Types of Home Construction Loans in Missouri

Once construction on your new home is complete, Bank of Old Monroe offers various permanent financing solutions.  Contact a loan officer to apply for an adjustable or fixed rate mortgage.

Stand-Alone Construction Loans

Stand-alone construction loans are separate funding vehicles from mortgages. They are an excellent option if you have substantial cash and foresee a lengthy construction process.

With greater flexibility, you can adapt your plans relative to an unexpected change in your budget, project, rates, etc.

At the Bank of Old Monroe, we strive to offer competitive home construction loans. Our lenders guide and support you throughout the process, ensuring you obtain the best loan for your needs.

Missouri Construction Loan Requirements

Generally, home construction loans in Missouri have more stringent approval requirements than traditional mortgages.

  • Credit History: Showing lenders you will complete each payment on time increases your likelihood of approval.
  • Debt-to-Income (DTI) Ratio: The lower the comparison between monthly debt payments and gross income, the better.
  • Proof of Sufficient Income: Ensure you have enough income to cover your current debts and new loan payments.
  • Detailed Plans: Present a detailed plan created by the construction company that outlines each step and how much it will cost.
  • Estimated Cost Breakdown: Any fees associated with the cost of the home. For example, finish grading, any applicable permits, and foundation work.

How to Obtain a Home Construction Loan in Missouri

To start, secure a pre-qualification. Doing so identifies your borrowing capacity when applying for a construction loan. Plus, it can help you save on expenses associated with blueprints for a home you can’t afford.

Next, find a reputable builder or contractor. Your chosen company should have the experience to complete the project according to the timeline and specifications. To establish trustworthiness, request copies of the builder’s insurance certificates, résumé, business license, and financial statements.

Finally, collect the required documents. These include contractor references, your detailed plan, project timeline, and the construction company contract.

Timeline of Construction Loans

The home construction loan timeline is crucial but varies depending on the lender, borrower, and project requirements. Here’s a more in-depth look at the timeline of home construction loans:

  1. Initial Application and Documentation Submission: The construction loan process begins with submitting the application, detailed plans, cost breakdown and necessary financial documentation to our lending team. These documents serve as the foundation for the loan approval process. They are essential for assessing the practicality of your project.
  2. Title Search and Appraisal: We will act once the lending team receives your application and supporting documents. They initiate a crucial step: the title search and appraisal. A title search aims to confirm the legal ownership of the land and any existing liens or constraints. The appraisal assesses the property’s value, helping our team determine the loan amount.
  3. Debt Management: During the next phase, borrowers need prudent financial management. We strongly advise not to acquire additional debt during the application and approval process. Additional debt can harm your debt-to-income ratio (DTI), a crucial factor in the lending team’s decisions.
  4. Loan Approval: Our team assesses documentation and project feasibility after the title search and appraisal. These documents must meet specific criteria for approval. The approval phase typically involves reviewing your credit history, income, and construction plan details. A lower DTI ratio and a strong credit history improve your chances of approval.
  5. Closing the Loan: Once you’ve successfully navigated the approval phase, the final step is closing the loan. You’ll sign essential documents at this stage, and the Bank of Old Monroe will disburse funds for your construction project, officially starting your home-building journey.

Generally, it takes around 30 days from the point of application approval to reach the closing stage. However, the duration may vary due to project complexity, processes, and unforeseen circumstances.

Apply for a Construction Loan in Missouri

Obtaining the funds needed to build the home of your dreams is possible with the Bank of Old Monroe! Our lending team can help qualified borrowers bring their vision to life with a short-term, fixed-rate home construction loan in Missouri. Contact us for more information and to start an application!

CONTACT A BANK OF OLD MONROE LENDER TODAY
We Offer Mobile Banking

Manage your finances on the go with the Bank of Old Monroe app! Our app allows you to view transactions, transfer funds, pay bills, deposit checks and more! To discover all the ways our app can benefit you, visit your app store and search “Bank of Old Monroe” to download.

Apple Store Disclaimer
Android Store Disclaimer
Close Menu
  • Learn About Scams

    Don’t fall for fake. Keep your money safe by learning the red flags of phishing.

    Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • 0Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Learn About Scams

    Don’t fall for fake. Keep your money safe by learning the red flags of phishing.

    Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.

  • Third Party Site Disclaimer

    By accessing the noted link you will be leaving Bank of Old Monroe’s website and entering a website hosted by another party. Bank of Old Monroe has not approved this as a reliable partner site. Please be advised that you will no longer be subject to, or under the protection of, the privacy and security policies of Bank of Old Monroe’s website. We encourage you to read and evaluate the privacy and security policies of the site you are entering, which may be different than those of Bank of Old Monroe.