Financing options

There are a few ways to finance your dream home, including:

Construction-to-Permanent Loans:

Construction loans are short-term, interest-only loans used to finance the building of a new home. You’ll only make payments on interest during the building phase with construction-to-permanent loans. Once your construction is complete, the loan then converts to a permanent mortgage.

Benefits of construction loans include:

• Staged Funding: Your payments align with the construction progress, avoiding paying one lump sum.
• Interest-Only Payments: You’ll only have to pay interest until construction is complete.
• Customization: You can customize your financing to your specific building projects’ needs.

Cash Loans:

These loans are given in a lump sum to your bank account or, as the name implies, in cash. The cost of interest payments and when you’re expected to start paying will vary depending on your lender. There are a variety of types of cash loans, from personal loans to cash advances.

Benefits of cash loans include: 

• Quick Access: For cash loans, you can immediately access your new funds.
• No Restrictions: You don’t need to earmark the loan for one specific purpose; you can use the cash loan for any portion of your home building process. 
• Simpler Process: Often, cash loans involve less paperwork and boast faster approval times.

There are also specialized funding options like owner-builder loans for those acting as their own contractor, VA and FHA construction loans for eligible borrowers with favorable terms, and USDA loans for building in rural areas.