Shirley Mueller’s team handles VA construction loans in Minnesota. One team works with you from pre-approval through move-in.
Building your own home in Minnesota with a VA loan
For a lot of Minnesota Veterans, building new is the only way to get the home they want. Existing homes in the right school district or on the right lake don't come up often. A VA one-time close construction loan lets you buy or pay off your lot, build and move into the finished home with one loan and one closing. Eligible Veterans pay $0 down on loans up to $1 million.
Shirley's team handles your Minnesota VA construction loan from application to closing, and can answer questions about lots, builders and timing before you apply.
Where Minnesota Veterans build
Around the Twin Cities, a lot of new building happens on the edges of the metro. Common spots include Lakeville, Farmington and Rosemount to the south, Rogers, Otsego and St. Michael to the northwest, and Forest Lake and Hugo to the north. Farther out, Elk River, Monticello and Big Lake give you more land and still keep the metro within driving distance.
Outside the metro, Rochester and the surrounding towns draw Veterans who work in health care. The St. Cloud area and the lake country around Brainerd and Baxter are popular with people who want to be near Camp Ripley or simply closer to the water. In the northeast, Hermantown and the townships around Duluth offer wooded lots near the Duluth Air National Guard Base.
Land, lakes and frost: what to check on a Minnesota lot
- Shoreland rules. Lakes and rivers come with shoreland zoning. Your county or city sets the setbacks, lot coverage limits and tree-removal rules. Before you buy a lakeshore lot, ask the zoning office what you can build and where.
- Septic systems. Rural lots usually need a septic system and a well. Counties issue septic permits and often require a soil evaluation and a backup drainfield site. Have the soils checked before you close on raw land.
- Deep frost. Minnesota has some of the deepest frost in the lower 48. Footing depth is set by code for your area, and builders plan foundations, basements and utility lines around it.
- Snow load and cold. Roof framing has to handle Minnesota snow, and the energy code affects insulation and windows. Your builder's plans and costs will reflect both.
- Wetlands and access. Many rural parcels include wetlands that limit where you can build. Make sure the lot has legal road access and that the road is plowed in winter.
If you already own land, the loan can pay off what's left on the lot at closing. Read about building on land you already own. The finished home also needs to meet VA's minimum property requirements.
Minnesota builder licensing
Minnesota's Department of Labor and Industry (DLI) licenses residential building contractors. According to DLI, anyone who contracts directly with a homeowner to do work in more than one skill area on a one- to four-unit home needs a residential building contractor license. Builders who build homes to sell also need one. DLI also runs the Contractor Recovery Fund, which licensed contractors pay into. You can look up a builder's license on DLI's website.
A VA construction loan has its own requirements on top of that. The builder must be approved by the lender before closing and must sign a fixed-price contract. Owner-builders and do-it-yourself work aren't allowed, even though Minnesota lets owners work on their own property. Read more on our builder information page and about why you can't be your own general contractor.
Permits and inspections are handled by your city or county, and some rural townships have their own rules. Your builder usually manages permits, but it helps to know who your local building official is.
How the VA construction loan works for a Minnesota build
Minnesota builders often want the foundation in before the ground freezes, so it helps to know the loan's timeline. A VA one-time close construction loan finances the lot, construction and permanent mortgage together, and closing usually takes about 2–3 months. The 12-month construction period starts after closing. You don't make payments during the build, because the interest reserve and construction management fee are part of the loan amount and paid by the builder (here's how the interest reserve works). At the end, the loan is a 15- or 30-year fixed-rate mortgage.
VA construction loans start at a 620 minimum credit score, and larger loan amounts may need a higher score. Loans over $1 million, up to a $2 million maximum, need 5% down. A 12-month construction period suits Minnesota's short building season. Your builder can plan around frozen ground and road restrictions without having to rush.
Minnesota's disabled veterans market value exclusion
Minnesota reduces the taxable market value of a qualifying disabled Veteran's homestead. According to the Minnesota Department of Revenue:
- Veterans with a service-connected disability rating of 70% or more can exclude up to $150,000 of market value. You reapply each year.
- Veterans rated 100% total and permanent can exclude up to $300,000 of market value. After approval, you don't need to reapply until ownership or use changes.
You need an honorable discharge, and the home must be your homestead. In some cases a surviving spouse can keep the exclusion for a limited time. Applications go to your county assessor, and the deadline is July 1 for taxes payable the following year. On a new build, talk with the assessor about timing once your home is finished and homesteaded. See our property tax exemption by state page for other states.
Military installations in Minnesota
Minnesota's installations include Camp Ripley near Little Falls, the Minneapolis–St. Paul Air Reserve Station and the Air National Guard base at the MSP airport, and the Duluth Air National Guard Base. Many Minnesota Veterans served in the Guard or Reserve. If you did, review VA construction loan eligibility to see how your service counts.
Take the first step
Whether you already have a lot or are still looking, you can start with the online application. It takes about 10 minutes and is a soft credit pull. Shirley has specialized in VA home loans for over 20 years; her team will review what you send and take it from there. To talk first, call 888-788-4977, email shirley.mueller@ccm.com or read the FAQ.
Minnesota VA construction loan FAQs
Who will close my VA construction loan in Minnesota?
Shirley's team handles it, from the first conversation through closing.
Can I build a lake home in Minnesota with a VA loan?
Yes, if it will be your primary residence and it meets VA requirements. A cabin you'll use part-time doesn't qualify. Check the county's shoreland rules before you buy the lot.
Does my builder need a Minnesota license?
Most residential builders who contract directly with homeowners need a residential building contractor license from DLI. Your builder also has to be approved by the lender before closing.
Can I build the house myself since I own the land?
No. VA construction loans don't allow owner-builders or DIY work. You'll need a qualified builder under a fixed-price contract.
How much does Minnesota's disabled veteran exclusion save?
It removes up to $150,000 of your home's market value from taxes at a 70% or higher rating, or up to $300,000 if you're rated 100% total and permanent. Your actual savings depend on local tax rates.