from dirt to doorbell.
A construction loan pays your builder in stages as the home goes up, then converts to a normal 30-year mortgage the day you move in. The best programs close once — one appraisal, one set of paperwork, one closing table. No second underwrite when the framing is done, no rate roulette while the drywall goes up.
Construction-to-permanent, explained
The old way was two loans: a short-term construction loan while the home was built, then a fresh mortgage application at completion to pay it off. Two closings, two sets of fees, and if rates moved against you in the meantime — tough luck. The construction-to-permanent (C-to-P) loan fixes that. You close once, up front, and lock your permanent rate before the first shovel hits dirt.
During construction you pay interest-only on the money that's actually been drawn — not the whole loan amount. When the certificate of occupancy is issued, the loan automatically converts to a 30-year (or 15-year) mortgage on the same note. No second closing, no second appraisal, no re-underwrite.
How your builder actually gets paid
Funds are released in stages — typically 4 to 6 draws — as construction milestones are completed. Foundation poured: draw 1. Framing and roof: draw 2. Rough plumbing, electrical, HVAC: draw 3. And so on. Each draw is inspected by the lender's third-party inspector before the check goes out.
Your builder gets predictable cash flow, you don't front the whole build, and the lender confirms progress before releasing money. It's a system designed so nobody's holding the bag if the project stalls.
Yes, they can appraise a house that doesn't exist yet
Construction appraisals use the plans, specs, and comparable finished homes to arrive at an "as-completed" value. Underwriters want to see a licensed, insured builder with a real track record, a fixed-price contract, and a realistic timeline. Owner-builders are possible on some programs, but the file gets a lot heavier.
The same underwrite covers renovation loans on a home you already own or are buying — including FHA 203(k) and Fannie's HomeStyle Renovation. If you want to buy a place that needs a $75,000 kitchen redo, we can roll that into the purchase mortgage instead of financing it separately.
Best fit if…
- ✓You're building a new home from the ground up
- ✓You're doing a major gut renovation on a purchase
- ✓You want to lock your permanent rate before construction starts
- ✓You have 10–20% of total project cost available
- ✓Your builder is licensed and has a real portfolio