Construction Loans
Construction loans: from blueprint to front door.
Building your home is exciting - and the financing works differently than a standard purchase. Here's how it comes together.
Construction loans fund the process of building a home, releasing money in stages ('draws') as the project reaches milestones. A construction-to-permanent loan then converts into a standard mortgage once the home is complete.
Because the home doesn't exist yet, lenders review the builder, plans, and budget closely. With the right preparation, the process can be smooth and predictable.
Quick facts
- Structure
- Staged draws
- Popular option
- Construction-to-permanent
- Review
- Builder, plans & budget
Key advantages
- Construction-to-permanent options with a single closing
- Funds released in stages as the build progresses
- Interest often charged only on funds drawn during construction
- Converts to a standard mortgage at completion
What to keep in mind
- A qualified, approved builder is typically required
- Detailed plans and a budget are reviewed up front
- Timelines and draw schedules require coordination
Frequently asked questions
Planning to build?
Let's map the financing early so your build stays on schedule and on budget.
This information is for educational purposes only and is not a commitment to lend or a guarantee of approval. Program guidelines, rates, and eligibility vary by lender, location, and individual circumstances and are subject to change. Please consult a licensed mortgage professional for guidance specific to your situation.