6 Must-Have Steps Before You Break Ground on Your Custom Home

BYOB Home Loans
May 12
2 min read

Thinking About Building Your Own Home? Start Here

Building a home from scratch is one of the most empowering decisions you can make, but success starts before you ever pour concrete. Whether you’re hiring a general contractor or managing your project as an owner-builder, the pre-construction phase is where your dream home becomes a real plan.

At BYOB Home Loans, we’ve helped hundreds of owner-builders get loan-ready and ground-ready. Here are the six must-have steps to take before breaking ground because what you do now can save you time, money, and stress later.

1. Get Pre-Approved for a Construction Loan

Before you buy land or hire contractors, secure your financing. Construction loans are different from traditional mortgages, they’re more detailed and milestone-driven.

What to prepare:

Credit score (aim for 620 or higher)
Income and tax returns
A preliminary budget and timeline

Start with a lender that specializes in owner-builders. They understand your unique path and won’t treat you like a traditional developer.

2. Choose the Right Land

Not all lots are created equal. The wrong property can delay permits, inflate costs, or block your design altogether.

What to check:

Zoning restrictions and building codes
Access to utilities and water
Soil conditions and drainage
Environmental risks like flood zones

Some lenders require land to be build-ready before they’ll release funds. Don’t skip the due diligence.

3. Finalize Your Floor Plan and Scope

This is where dreams meet blueprints. Lenders and permit offices will need a finalized set of construction plans.

Your design should include:

Architectural drawings
Square footage and materials list
Energy code compliance
Interior and exterior elevations

Many first-timers change plans mid-build. Lock in your vision now to avoid thousands in change orders later.

4. Create a Realistic, Itemized Budget

A vague estimate won’t fly. You need a line-by-line breakdown of costs, from concrete to cabinetry.

Must-have budget items:

Site work (clearing, grading, utilities)
Foundation and framing
Permits, insurance, and inspections
Appliances and finishings
Contingency fund (10–15%)

Need help? BYOB Home Loans offers sample budgets and calculators to get you started.

5. Build Your Team

Even if you’re managing the build yourself, you’ll need a professional support network.

Who to recruit:

Licensed subcontractors (plumbers, electricians, framers)
Project manager or construction consultant
Surveyor, engineer, or architect if needed

Lenders will want resumes, licenses, and insurance for any professionals involved, so choose carefully and document everything.

6. Secure Permits and Insurance

You can’t legally break ground without the right paperwork.

What you’ll need:

Building permits from your local municipality
Construction liability insurance
Site plans and engineering reports where required

Start this process early. Permits can take two to six weeks or longer depending on where you’re building.

Success Starts Before the Build

The most successful custom home builds happen because of smart preparation. These six steps are your foundation, not just for your home, but for your budget, loan, and timeline.