Building a Spec house

I am looking at building a spec home in our area. I will be doing the building but will be subbing out the concrete, electrical, plumbing and HVAC. I am looking at building a 1,100sf main with a partially finished basement. I figure land to be $10,000, material to be $35,000 and probably $20,000 for the subcontractors. I also figure the house to sell for around $110,000 when completed, possibly more. How do i go about financing something like this? I will be quiting my job and going to part time as needed so i will need my salary basically into that payment with some to pay a part time helper. I am figuring 6 months to be able to get it on the market and another 2-3 months to sell, so probably want a 9-12 month loan. What are some of my options for doing this? I am having troubles finding rehab houses that i can make money on in this area, so im looking at a different approach.

Quitting your job may limit limit you to only NINA/NIVA loan programs (they exist, but only hard money versions).

Furthermore, you might need to do this in a two step process (1 loan to purchase land and another for construction).

Residential hard money construction lenders tend to base financing arrangements on one of the three ratios; LTV, LTC or subject to completion value.


Scott Miller

Well i wont be quitting but working on an as needed basis, but may not even need to do that. Depending on how long i can go with the loan, i can work on it nights and weekends, but obviously this will take longer. Also having 3 weeks vacation built up, i could use a week and a half to frame it and get the majority of the outside work done and have the electricians, plumbers, and hvac guys come in and do their thing.

As far as the land goes, ive got a couple pieces of ground in mind for under 10k. I can buy that on my credit card if needed