A construction-to-permanent loan lets you build and finance with one loan.
If you’re planning to build a home from the ground up, this loan combines construction financing and a permanent mortgage into one convenient package. That means fewer closing costs, simplified financing, and a smoother transition once construction is complete.
Benefits of a Construction-to-Permanent Loan
- One-Time Close: Finance your build and permanent mortgage in a single transaction.
- Rate Protection: Lock in your interest rate before construction starts.
- Interest-Only During Construction: Make lower payments while your home is being built.
- Flexible Terms: Choose a repayment plan that fits your long-term financial goals.
Construction-to-Permanent Loan Eligibility Requirements
- A solid credit score (typically 680 or higher)
- A qualified builder or general contractor
- A detailed construction plan and budget
- Proof of stable income and low debt-to-income ratio
- Down payment may vary but is often 5–20% depending on the lender and project
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