So how exactly does a construction loan work? Usually, construction loans are done two ways that are different. The very first choice is a construction-permanent home loan plus the second item is really a construction-only home loan.
A construction-permanent home loan is both your construction loan and long term home loan combined into one loan, and that means you have only one closing for both your construction loan along with your long term home loan. This saves you money and time. On top of that, using this types of construction loan, your rate of interest is guaranteed in full up-front, meaning that you don’t have actually to lose rest over just just what happens to rates of interest while your property is being built. You’ve got satisfaction once you understand just what your rate of interest and payment that is monthly be.