Do you have Southstate Bank in NC? This is who I’m using. I reached out to over a dozen lenders and this is the only one that worked out.

Are you licensed to build in the range that you are building? How many houses have you GC'd? Did they come in on time? Do you have good connections with subcontractors?

You will need to go to a small, local bank for this or a credit union.

It can be done. It's not easy.

Will building your own house take away from your own income? Can you afford tolose that income to focus on your own build? If GC fees would be about $100K - can you afford to have $100K less income while you build?

These are things the bank will want to understand.

Typically this is a commercial type loan since you're self employed (not a W2 job) & it's for you. Local banks. Similar to a spec home loan.

I am a full time teaching instructor (teaching construction management) at a local university. Being a GC is a part time gig, but been managing projects for others for quite a while. I do have a license to build what I want for myself and have done other similar projects in the past. I do have good relationships with a few subs.

Realistically, the cost savings by doing it myself will replace any loss in revenue by focusing on my own project. Most of the $ I make is from doing complete renovations of 100+ year old homes I buy and fix from ground up.

I am pretty capable, more so than most owner-builders who want to try it and have limited or no construction experience.

Mostly, I’m looking for lending institutions which will let me build my own home. The last major project ($460k renovation) was financed through a local bank which merged and no longer offers that product. So I’m back at square one again, but with my own home versus a spec build/renovation.

And Jeff, like you said, I’m considering doing it commercially like I have in the past, but then convert to permanent for myself in the end. But rates are a bit different here and I have to be careful not to be fraudulent since the point of the commercial loan is to sell to a client (short term loan for me). Their approval criteria are a bit different than a C2P product.

"Why is it so difficult to find a bank that will allow me to build my own house?" Because underwriters as a group are pretty risk averse.

In my experience, local community-based banks tend to be more flexible and are better to work with than regional or national banks. The larger amount of equity you have in the property and will have in the home based on an appraisal, the more likely you are to find a willing lender.

I get it. But asking an owner to take on an additional $100k expense and lessening the equity in the property seems a bit counterintuitive to managing risk. I get it if I wasn’t already a licensed professional.

We could discuss the why’s and such all day. But I’m hoping to find someone that can provide a contact to a lender that supports owner builders in NC. So if anyone out there has done this before, please message me or post up some info on a lender as it would be much appreciated.

It's not unreasonable for a lender to require a builder with more new home building experience than you have as a prerequisite for approving a construction loan.

Can you get a bank to finance a spec home? Build one and sell it to yourself.

Local or regional bank construction loan. This is a typical commercial loan. Not much different than most developers. You have 2 exit strategies to get them out of the loan before maturity - sell or obtain permanent financing. Its secured. Likely you'll need 25-30% equity and a cash reserve.

RC, you have FAILED to answer the questions people have asked you. These questions were some of the same I was going to ask when you first posted your discussion but passed.

DO You have the land to build on? Free and clear or is there a loan on it?

Do You have a considerable amount of your own cash to invest in the build?

IS your income verifiable and adequate to qualify for the requested capital?

IS your credit rating even good enough to quality for a loan?

Do you have a house now with equity in it? Free cash flow?

All I see is you beating your drum of what you did in the past, have a license, and teach a trade. None of these mean little to a lender and won't secure a nickel they lend you.

I know a guy who did what you're looking to do in the early 2000's when money was easy to get. He secured construction loans to build a massive home for his 8 kids and took him years to finish it doing most of the work himself. When it was finished in the mid 2000's times had changed and he couldn't get a mortgage to pay back the other loans so home was repo'd along with his 20 acres it sat on.

I see pages of google hits showing banks in North Carolina offering construction loans and construction to permanent loans, so there has to be an issue you won't disclose.

The consumer mortgage industry, including construction loans, is largely based on reps and even underwriters who are just checking boxes and really don't have the skills or knowledge to deviate from norms. One of my colleagues was a loan underwriter for a while, her degree is in classical studies (Latin), I dare say that she is not an expert on risk analysis.

The problem likely has nothing to do with the OP's construction ability, or the OP's credit, etc. it is just the OP is asking for a loan that several deviations from typical and many banks are simply not interested in that business, mostly because there isn't enough owner-builder financing to defer the marginal costs of more training for their reps and underwriters.

I have had good luck with medium sized regional banks. Most regions have a bank that will write portfolio loans and will work with Owner-builders, however, there may only be a single bank willing to do that in a particular region, you should just keep looking. I am sure North Carolina has a few "farmers banks" which can typically be a bit better for this type of financing.

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If that doesn't work out, there are always services like Ubuildit which basically take a fee for construction management and smooth the process of finding subs and financing. These companies are largely just selling their contact list, but that may be what you need. There are Ubuildit offices in North Carolina and they will have banks that are willing to finance their projects.

I’m not losing out on income by doing this myself because I already have a full time teaching job at a university. That answers the “loss of income” question. I also have 3 months off in the summer to work on the house as needed. Teaching at a university allows for a lot of flexibility in schedule to make site visits and meet with subs and inspectors as needed. And by being my own owner-builder, I’m my own GC, I’m not actually performing the work on the house, that’s what my subs are for; it seems that some of the commenters think I’m self-performing all the trades work, which is unrealistic. Timeline is to be completed by the end of the year. I own my own land already free and clear. My wife and I have sufficient income and reserves for this project; I wouldn’t be pursuing this if I didn’t. I also buy and sell real estate and have rental property, so there are sufficient assets and cash flow. Yes there are lots of people that offer construction to permanent loans, but not if you want to be your own GC. Most I’ve talked to want me to hire a different GC to build my house for me (and pay him 20%). This is their policy for their product offering, not a reflection of what I can or can’t do or am able to do. I’m not asking how to do it, physically or financially (I already know), I’m in seek of a lender that allows for an owner to act as their own GC that serves NC.

@bry911 gets what I’m looking for. I refinanced a couple properties last year and purchased another rental last year as well. Finances are the issue. Finding a lender that will loan to an owner-builder is the challenge. Yes there are plenty of people that offer construction loans, but once you talk about being your own GC, it’s a hard NO regardless of $ or ability. It’s their internal policy for that product. I know there are a couple lenders around and I have found some over the last day or so of calling around and visiting more with them. But they are few and far between.

Oops, finances aren’t the issue.

I looked it up and Southstate is in: Florida, Alabama, Georgia, North Carolina, South Carolina and Virginia

I think you said you’re in NC… I’d definitely suggest applying with them/ looking into this bank…

Sarah, I did look them up and called them yesterday. Thank you for the suggestion!

We are trying to do the same and have had trouble finding financing! Did Southstate work? Or did you find another bank?

I'd try small local banks or credit unions before national ones. Your GC license might raise red flags about conflict of interest, so be ready to explain your subs and timeline. Also consider the income loss banks will factor in. When I needed similar guidance, I found practical articles on business funding when I browse around this website. Worth a look.