Based on your responses, we think you may be interested in the following loans:

A construction-to-permanent loan generally entails a down payment of at least 10% of the project total, as determined by the cost of the land and the plans the buyer and builder draw up.

For construction-to-permanent loans, the loan will be converted to a permanent mortgage with a term of 15 or 30 years. You can choose either a fixed-rate or adjustable-rate mortgage (ARM¹).

• Fixed: Fixed rate mortgages are what they sound like, mortgages with a fixed interest rate that never changes.
• ARM¹: Adjustable-rate mortgages have a fixed rate for a defined time period, then will adjust at designated times after that. This rate will be based on a margin applied to a standard index (SOFR) and can go up or down depending on the index rate. They are usually described using two numbers such as 7/6, this would mean the 30-year loan will have a fixed interest rate for 7 years and then adjust every six months after those years are up. This can often be useful for borrowers when are looking for the lowest possible payment in the short term.

1. The borrower applies for a construction loan, submitting financials, plans and project timelines.
2. If approved, the borrower starts drawing funds in conjunction with each phase of the project, typically only repaying interest. Throughout construction, an appraiser or inspector assesses the build at key intervals to authorize more funds.
3. Once construction finishes, the loan converts to a permanent mortgage and both principal and interest payments begin.

• Interest only¹ payments during construction
• One-time closing costs
• Land purchase can be included in costs
• Fixed rate and ARM¹ loans available

Step 1: Getting Started

During this step, your application will be started. Things like your credit may be pulled and paperwork is collected from you to confirm employment and income as required. For your construction loan you will need to provide project timelines and plans and financials. Within 3 days of completing your application you will receive a Loan Estimate (LE) that will give you a complete and detailed breakdown of the costs associated with your loan.

Step 2: Bringing It Together

This step includes combining your application with the documents you have provided. We’ll review these items and may require additional paperwork depending on the type of mortgage. If an appraisal is required, it will be ordered during this stage.

Step 3: Reviewing the Facts

In this step, your application and supporting documents will be evaluated in detail. If necessary, we will verify your income and assets, and check the guidelines to make sure we have thoroughly completed the evaluation.

Step 4: Meeting the Criteria

Some applications may meet the initial loan criteria but still need a few more items to move it forward. If this is the case with your application, you’ll be hearing from us to explain what’s needed.

Step 5: The Loan Closing Process

This is the final step in the application process. You will be hearing from us about any remaining details so we can make sure we have everything we need. Additionally, the title company will set up a meeting for you to come in and sign all required closing documents, so get your pen ready. You will be provided a Closing Disclosure in advance of your closing that, like the loan estimate you got at the beginning, breaks downs all the associated costs and elements of your mortgage.

Step 6: Building Your Home

Congratulations! At this stage you can start building your home. The bank will release funds as each phase is completed to pay for the next phase to be worked, with periodic inspections to confirm the work is being completed. During this part you will only be making interest only payments.

Step 7: You're Home!

Once the final inspection has been completed, your loan converts to a traditional mortgage and you will begin making your regular principal and interest payments.