Blog - Dream Home

Do You Need a Down Payment for a Construction Loan?

Thinking about building your dream home? If so, you’re probably curious about the down payment needed for a construction loan. Just like with traditional mortgages, there’s some flexibility in how much you’ll need to put down. Let’s dive into what you need to know about down payments for construction loans. The Short Answer: Yes, But It Depends Most of the time, yes, you will need a down payment for a construction loan. However, how much you’ll need to put down can vary quite a bit. The required down payment generally ranges from 5% to 20% of the total loan amount. Here’s

Interest Rates and Terms: What to Look for in a Construction Mortgage

Congratulations on deciding to build your dream home. Before you dive into floor plans and paint swatches, let’s discuss something equally important: financing your build. Understanding interest rates and loan terms is crucial when choosing a construction mortgage. Let’s break it down so you can make an informed decision. How Interest Rates Work on Construction Loans Construction loans have some unique features when it comes to interest rates: How Does the Draw Process Work? 1. 2. 3. Higher Rates: Construction loans typically have higher interest rates than traditional mortgages. Why? Because there’s no existing home to act as collateral, there is

Understanding the Draw Process: How Construction Loans are Paid Out

Building your dream home is an exciting journey, and understanding how your construction loan works is a crucial part of that process. Let’s dive into one of the most important aspects of construction financing: the draw process. What is the Draw Process? When you get a construction loan, you only receive some of the money upfront. Instead, the funds are released in stages as your home is built. We call these stages “draws.” It’s like getting pieces of a pie one slice at a time, with each slice corresponding to a different phase of your home’s construction. How Does the Draw

Step-by-Step Guide to Financing Your Custom Home Build

Building a custom home is an exciting venture, but figuring out the financing can feel overwhelming. Don’t worry! You can break it down into manageable steps with the right approach and a clear understanding of the process. Whether starting from scratch or planning a significant addition, here’s how to navigate the financing side of things. Step 1: Get Pre-Approved for a Construction Loan For example, when buying a house, the first step in building one is getting pre-approved for a construction loan. This step is crucial because it gives you a clear picture of how much you can borrow, setting the

Breaking Down the Basics: What is a Construction Mortgage?

Are you thinking about building your own home? It’s an exciting journey, but let’s face it—figuring out how to pay for it can be tricky. That’s where construction mortgages come in. Let’s walk through what you need to know about financing your dream home from the ground up. What is a Construction Mortgage? A construction mortgage (or construction loan) is a special type of home loan designed specifically for people who are building a house rather than buying an existing one. It’s different from a regular mortgage in a few key ways: Short-Term: Construction loans are short-term, typically lasting just for

Do You Need a Down Payment for a Construction Loan?

Interest Rates and Terms: What to Look for in a Construction Mortgage

Understanding the Draw Process: How Construction Loans are Paid Out

Step-by-Step Guide to Financing Your Custom Home Build

Breaking Down the Basics: What is a Construction Mortgage?

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