The construction loan process is somewhat different from a standard mortgage. Therefore, we have distilled the process into 6 main steps that describe each stage of the process of building a home or doing a renovation loan. Please keep in mind these are general steps and the timing might look different depending on what type of construction project you are looking to do.
First things first, apply for your construction loan. This is a crucial first step for building.
Find your builder. Key things to keep in mind when looking for a builder in your area:
After you find your builder and have signed your contract, the construction loan process begins. During this time, you will be required to provide all needed documentation for underwriting. The construction loan approval and close should take around 30-45 days.
When your home construction loan closes, you will be able to start building your home! The construction of your home will typically start within 30 days of closing. This is an exciting moment in your building process
Over the next 12-18 months, your home will begin to come to life. Throughout this process, your building team will provide you with updates on the progress of your home. During this phase, your lender will manage the draws associated with your loan.
Congratulations, you did it! Your home is completed, and you get to move in. At this time, your construction loan is done and has been converted into your new home mortgage.
