5 Best Construction Loans in Wisconsin


Are you looking to build or redesign your home in Wisconsin but are still looking for financing? Perhaps it is time to consider construction loans.

Wisconsin is the 20th-most populous state in the country, with most of the population living along the shores of Lake Michigan. Known as the Badger State, Wisconsin’s population has been increasing for many years now and is home to more than 6 million residents.

With the influx of new people and limited housing inventory, home prices have been rising. The median house price across the states is $275,000 according to the Wisconsin Realtors Association. Meanwhile, local real estate experts estimate that building in Wisconsin will cost between approximately $80 to $120 per square foot.

Due to the rising costs of purchasing existing homes and the cost of building, many people are turning to construction loans in Wisconsin as a way to save money and build a dream home.

Let’s go over some of the other benefits that you’ll find when you take out a construction loan in Wisconsin so that you can decide whether or not this is the right solution for your needs.

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Benefits of a new construction loan in Wisconsin

So, you’re thinking about getting a construction loan. These types of loans have some unique benefits compared with traditional home loans. Let’s look at some of the advantages you’ll find when you take out a new construction loan. 

Approval at beginning of project. Most new construction loans are approved before any construction has begun. When you get approved for a construction loan, you will have guaranteed access to the entire amount you need to complete the project, making construction loans a way to engage in a building project with confidence.

Interest-only payments. You don’t have to worry about making principal monthly payments during the building process. Most construction loans only require interest payments during the construction phase, giving you some flexibility in paying for the new construction while also covering your monthly housing costs.

Your lender will be involved in the project. If you pursue a construction-to-permanent loan, your bank will be invested in making sure the builder completes the project on time and without flaws. After all, the house will ultimately be the bank’s collateral and the bank doesn’t want a problematic house. Your lender will also help ensure that any problems are addressed promptly by the builder so that they don’t delay completion or cause you any additional expense.

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5 Best Wisconsin construction loan lenders

If you’re in the market to build a new home in Wisconsin, consider these construction mortgage loans that are available to state residents.

1. Wintrust Mortgage

Wintrust Mortgage is one of the top 20 bank-owned retail mortgage originators in the country that originates in excess of $4 billion in loans annually in all 50 states. 

Recently we asked Wintrust Mortgage to provide us with details on their construction loan and this is what they said:

  • One-Time Closing. Only pay the closing cost once
  • Fixed-rate mortgage. Lock in your rate upfront and avoid interest rate risk
  • FHA, VA, and Conventional options
  • 0% Down up to $822,375 (VA ONLY)
  • 3.5% Down up to FHA County Limits ($356,362-822,375) 
  • 10% Down on Second homes
  • FICO 680+ credit approval
  • Loans must include building no Lot/Land Loans 
  • Maximum of 10-acres per build site
  • Stick Built and Modular Homes ONLY
  • NO log homes or metal homes (barndominium)
  • Tear Down and Rebuilds do qualify
  • No self-build or owner builders. The builder must be approved. 
  • Does Not allow ADUs (Accessory Dwelling Unit – Granny Flat/Garage Conversions/Basement)
  • Now lending in all 50 States

If you’re interested in connecting directly with a loan officer at Wintrust Mortgage that specializes in construction loans, we can put you in touch with them directly.

2. UW Credit Union

UW Credit Union was founded nine decades ago and now has over 290,000 members, making it a large credit union in the state of Wisconsin. Originally tied to the University of Wisconsin-Madison, UW Credit Union membership eligibility no longer requires being a UW student to join.

We were particularly interested in the UW Credit Union construction loan, so we contacted the credit union to learn more. Here are some highlights:

  • Available for land/lot purchases
  • Available for home upgrades or new builds
  • 12-month interest-only, fixed-rate loan with principal payment due at maturity
  • As low as 10% down payment needed
  • Available for first or second homes
  • Financing available to refinance your construction loan into a mortgage upon construction completion

If you’re interested in connecting directly with a loan officer at UW Credit Union that specializes in construction loans, we can put you in touch with them directly.

3. Northview Bank

Northview Bank has served Minnesota and Wisconsin for over 100 years and is a locally-owned bank by the Pogatchnik family. With a long history of financing the purchase of land in both Minnesota and Wisconsin, they are a natural fit for a construction loan.

We wanted to get more details about Northview Bank’s construction loan, so we contacted them to learn the following details:

  • Single close construction loan
  • Only pay one set of closing costs and have the guarantee of interest rate protection while under construction.
  • We do this with a simple loan modification process once your home is completed.
  • Renovation projects are acceptable

If you’re interested in connecting directly with a loan officer at Northview Bank that specializes in construction loans, we can put you in touch with them directly.

4. BMO Harris

BMO Harris is the 8th largest bank in North America by assets and provides financial services ranging from personal loans and commercial banking to wealth management and investment services. Among these many products, they also provide a construction loan for those looking to build or renovate a home.

We spoke directly with a loan officer at BMO Harris to learn more about their construction loan program and were able to get quite a lot of details. Here is what you need to know:

  • 700 Minimum credit score required
  • 10% down up to $1M loan amount (No PMI…720+ credit score required)
  • 20% down up to $2M loan amount
  • 30% down up to $3M loan amount
  • 35% down up to $4M loan amount
  • 40% down up to $5M loan amount
  • 45% down over $5M+ loan amount
  • 10% of the loan amount required for reserves
  • Primary residence and Second homes only (1 unit only)
  • Ground-up or tear-down construction utilizes Loans-to-Cost
  • Renovation utilizes As-Completed Value
  • 12-24 month construction periods are available 
  • 30/20/15/10 Fixed or ARM (5/6, 7/6 & 10/6) available
  • One-time closing automatically converts to permanent financing at the end of construction
  • Only 1 appraisal needed
  • 90 day lock same as 30 day pricing
  • Relationship rate discounts are available
  • Interest-only payments during construction
  • No prepayment penalty
  • No Spec or Investment Builds
  • No Builder Approval Required (must be licensed with General Liability coverage)
  • No owner builder
  • No Pre-starts
  • No Modular, Mobile for Manufactured homes

If you’re interested in connecting directly with a loan officer at BMO Harris that specializes in construction loans, we can put you in touch with them directly.

5. WESTconsin Credit Union

WESTconsin Credit Union started serving the Menomonie agricultural community in 1938 but has since expanded throughout the state to 26 counties across west-central Wisconsin and east center Minnesota. In addition to personal checking and business checking services, lines of credit and credit cards, the credit union offers a construction loan.

We contacted WESTconsin Credit Union to get more information about their construction loan and this is what we learned:

  • Home construction loans typically require interest-only payments during construction.
  • The money is drawn in increments that follow along with the construction schedule, with interest charged on the total disbursed to date.
  • Knowledgeable, local market decision-making and underwriting
  • Up to 90% loan-to-value
  • Lot loan or land financing up to 90% for future construction
  • 12-month term
  • One-time closing options available
  • Loan-to-value as high as 90% on a one-time close

If you’re interested in connecting directly with a loan officer at WESTconsin Credit Union that specializes in construction loans, we can put you in touch with them directly.

Does a Wisconsin construction loan make sense for you?

If you’re considering a construction loan, it’s important to understand the risks and benefits of this type of financing. Construction loans are not for everyone. They can be costly, so it’s important that you understand how they work before deciding if one is right for your situation.

A construction-only loan is a short-term loan used to finance the construction of a new building or home. It’s typically taken out while the building or home is still under construction and paid back once it has been completed and sold. The borrower receives funds from their lender in increments over time, typically monthly or quarterly payments depending on their contract with the lender.

A construction-to-permanent loan is a short-term construction loan combined with the certainty of converting the construction loan into a permanent loan at the end of the construction phase. It’s typically used when the homeowner wants to lock in an interest rate at the beginning of construction and wants to only pay one set of closing fees to a title company.

The cost of these loans can vary depending on interest loan rates, fees associated with closing costs (such as appraisal fees), and other factors such as credit scores, home equity or down payments at closing time (if applicable). It’s important to speak with an expert who understands all aspects of this type of financing and can help with your loan application, disclosures and pre-approval before making any decisions.

If you’re looking to explore construction loans in other states, check out our national guide to construction loans and get started exploring all 50 states.

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Joshua Holt

Joshua Holt is a licensed mortgage loan originator (NMLS #2306824) and founder of Biglaw Investor. His mortgage expertise lies in the areas of professional mortgage loans, particularly for lawyers, doctors and other high-income professionals. Prior to Biglaw Investor, Josh practiced private equity mergers & acquisition law for one of the largest law firms in the country.

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