Financing Your Barndominium, Custom Home, or Remodel in Tennessee
One of the most common questions we get from clients planning a barndominium or post-frame home is: “Can I even finance this?” The answer is yes — more often than people realize. But financing a post-frame home or barndominium is different from a standard mortgage, and knowing your options upfront saves a lot of stress later.
Loan Types for Post-Frame and Custom Home Builds
Construction Loans
A construction loan is the most common financing path for ground-up custom builds. The lender funds the project in draws as construction progresses. Once the home is complete, the construction loan typically converts to a permanent mortgage. Most major banks and credit unions offer construction-to-permanent loan products.
Farm Credit (USDA)
Farm Credit Mid-America is a strong option for rural and agricultural property owners in Tennessee and Kentucky. They have extensive experience financing post-frame structures and barndominiums on agricultural land. If your property qualifies as a farm or agricultural parcel, this is often the best rate and the smoothest process.
FHA and Conventional Mortgage
If your barndominium or post-frame home is appraised as a residential structure with comparable sales in the area, conventional and FHA financing is possible. Lender familiarity with this building type varies — working with a lender who has done this before makes a real difference.
VA Loans
Veterans and active-duty military in the Fort Campbell and Clarksville area may be eligible for VA loan financing on a post-frame home or barndominium. VA loans offer competitive rates and no down payment requirement. We recommend Veterans United and other VA-specialist lenders for this path.
HELOC and Home Equity Loans
For homeowners remodeling an existing property, a Home Equity Line of Credit or home equity loan is often the simplest financing path. If you have equity in your current home, this can fund a remodel, addition, or detached shop or garage without a full construction loan process.
Personal Loans
For smaller projects — a detached garage, a shop under $100,000, or a targeted remodel — personal loans can provide fast, flexible funding without the complexity of a construction loan.
What Lenders Look For
Most construction lenders want to see: land ownership or a signed purchase contract on the land, credit score generally above 680, a down payment of 10 to 20 percent, a detailed construction contract and draw schedule from your builder, and plans and specifications for the project.
One Shield provides all documentation a lender needs: a detailed contract, itemized draw schedule, and project specifications. We have worked with lenders before and know how to support your financing process.
Lenders We Recommend in This Region
Farm Credit Mid-America — strong for agricultural and rural land builds in TN and KY.
F and M Bank — local Clarksville bank with experience in construction lending.
Veterans United — recommended for VA loan borrowers in the Fort Campbell area.
Frequently Asked Questions
Do you offer in-house financing?
No. One Shield is a construction company, not a lender. We work with your lender and provide all documentation needed to support the loan process.
Can I start building before my loan closes?
In most cases, no — lenders require a closed loan before construction begins. We can help you time the process so groundbreaking happens as soon as financing is in place.
What if a lender says they don’t finance barndominiums?
Find a different lender. The market has changed significantly in the last five years. Lenders experienced with post-frame residential construction exist in this region — we can point you toward ones who have successfully financed similar projects.
Let’s Talk Through Your Financing Path
Call Milton at 931-542-7550 and we will talk through your project and point you toward the right financing approach. Serving Clarksville, TN, Middle Tennessee, and Western Kentucky.
