Funding to build your dream home from the ground up.
Ensure funds are allocated precisely where they’re needed during each phase of construction.
Building a new home can lead to immediate equity gains, as the value of the completed home may exceed the total cost of construction.
Building a custom home that incorporates high-quality materials and modern features can enhance the property's resale value and appeal.
In some cases, interest paid on a construction loan may be tax-deductible, similar to a traditional mortgage, offering potential financial advantages.
A Construction Loan provides funds in installments, known as draws, based on the progress of the construction project. During the construction phase, you make interest-only payments on the amount drawn. Once construction is completed, you will either refinance into a traditional mortgage or pay off the loan in full.
Yes, you can choose your own builder or contractor for a Construction Loan. You will need to provide detailed information about your builder or contractor during the loan application process. We will review the builder's credentials, experience, and financial stability to ensure they can complete the project.
To qualify for a Construction Loan, you typically need a good credit score, a substantial down payment (often 20% or more), and a detailed construction plan or blueprint. Additional information is also required, including a budget, timeline, and information about the builder or contractor.
Unlike a traditional mortgage, which provides a lump sum for buying an existing home, a Construction Loan is designed for financing the building or renovation of a home. Construction Loans are disbursed in phases, and the borrower usually pays interest only during the construction period. Traditional mortgages involve fixed monthly payments and are usually longer-term.
The typical down payment for a Construction Loan is around 20% to 25% of the total loan amount. This can vary based on the project’s scope and the borrower’s financial situation. A larger down payment may improve your chances of loan approval and potentially secure better terms.
A draw schedule is a timeline that outlines when and how funds will be disbursed during the construction process. Payments are made to the builder or contractor in stages based on project milestones or completion of specific work phases. The draw schedule helps manage cash flow and ensures that funds are used appropriately.
Yes, a Construction Loan can be used for major renovations or home improvements. The loan covers the cost of the renovation work, and the disbursement process is similar to building a new home, with funds released in stages as the renovation progresses.
Construction Loans are typically short-term loans, lasting 6 to 12 months, depending on the scope of the project. The loan term covers the construction period, after which the borrower will need to transition to a permanent mortgage or repay the loan in full.
If construction is delayed, you may need to extend the Construction Loan or renegotiate the terms. Delays can impact the disbursement schedule and increase costs. It’s important to communicate any issues with us and work with your builder to manage timelines and budget.
Renovation Construction Loan: Specifically designed for major home renovations or improvements, covering the costs of remodeling projects.
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