You have driven by that beautiful log home hundreds of times wishing that
one day you too can own one. Now that the seed has been planted, how do you
decide if a log home will fit into your budget? This article will serve as a
guide on how to achieve that dream of owning a log home. Before you start
searching for a log home company, there are several things to you should
think about: what features you desire in a home, the log species and profile
that you like, and how much of the building you are willing to do as well as
a price range you are willing to spend on your log home (built to completion
with or without land included).
The first step in making your dream home become reality is to choose a
log home company. Easier said than done because there are hundreds of log
home companies competing for your business. We researched about fifty
different log home companies before we made our decision and yes it was time
consuming but you need to find the company that best fits your needs. To
narrow down the list of companies to choose from, decide on the log species
(i.e. White Pine), log profile (i.e. round), size of logs, type of logs
(kiln-dried, dead standing, air dried, green), and the building system that
you like the best. Another way to narrow down the list is to tour log home
models built by different log home companies and, if possible, tour the log
home mills themselves. Now you need to submit a sketched floor plan of your
dream home to the companies that you have chosen and obtain a log home
package cost estimate that includes a shipping estimate. When comparing
price quotes from these companies make sure you are comparing "apples to
apples", meaning each companies' log home package is slightly different than
the other. Choose the package that best suits your needs and price.
The second step is to decide how much "sweat equity" you are willing to
put into your home. The more that you are able to do yourself means the more
you will be able to save in labor costs. How much does it cost to complete a
log home depends on the labor rates in your area. Most log home companies
can quote a turnkey price (completely built home, ready to move in) as well
as just the log home package price. Research different labor rates in your
area as well as building materials that are not included in your package and
compare these costs to your turnkey price given to you by the log home
company. Ask your log home company if they can provide a list of area
contractors. Being your own general contractor also saves money by
subtracting about 10%-20% off the cost of building your log home, however
you have the headaches that go along with that job. If you decide to be your
own general contractor, you will need to develop a cost estimating worksheet
with a breakdown of all the costs associated with building your home.
Is the price of your dream home still within your budgeted range? If the
answer is yes, then you can move on to obtaining financing. If the answer is
no, then there are some areas where costs can be reduced provided that you
are flexible. You may opt for more "sweat equity", choose a smaller diameter
log, reduce the size of your basement, or settle for less square footage to
bring your price down. It is typical when building your first home that
adjustments need to be made in order to fit your original budget.
Finally, your cost estimating worksheet is done and you have your
blueprints, now you are ready for financing. There are quite a few lenders
out there that specialize in log home financing which is slightly different
than traditional stick built financing. Again use the resources of the log
home company you have chosen, they should be able to provide a list of
specialized lenders as well as help you with the financial paperwork. Do
your homework before approaching a lender and the process will run smoother.
Most lenders offer a construction loan for up to one year and then required
you to re-qualify for the mortgage loan after your home is completed.
Another option is a "One Time Close" loan which combines the construction
and permanent financing into one easy loan. One Time Close loans are nice
because you only pay closing costs once and usually only qualify once for
the loan. These loans are usually given at a slightly higher interest rate
during the construction loan period and can be "rolled down" at the time
that the permanent loan starts. When financing your loan, be prepared to
have a down payment of 5%-15% of your loan value and in most cases you may
use the value of your land as your down payment provided you own it free and
clear. Once financing is approved, you can begin building your dream log
home.
Now you can let the seed grow into a beautiful log home that someone else
will admire. Keep in mind that the process of building your own log home is
time consuming and Murphy's Law does apply, but the end result is rewarding.
Steve & Melinda Ryan
Colorado Old Timer Log Homes
For further information on budgeting, cost estimating and financing contact
us at (303) 884-1378 or via e-mail at
moandmongo@aol.com.
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