Construction Loans

What is a Construction Loan?

A construction loan is a specialized financial product designed to provide funding for the construction or renovation of a residential property. Unlike a traditional mortgage that provides a lump-sum payment for an existing home purchase, a construction loan provides financing in stages as the construction project progresses. Here's a closer look at the key features of construction loans:

Construction Loans vs. Traditional Mortgages

Construction loans differ significantly from traditional mortgages. Here's a comparison to help you understand the distinctions:

How Do Construction Loans Work?

Construction loans follow a structured process to ensure funds are disbursed efficiently and the project stays on track:

Types of Construction Loans

Construction loans come in various types to suit different needs:

Construction Loan Requirements

To qualify for a construction loan, borrowers typically need to meet certain criteria: