Construction Loan
Lending & MortgagesA short-term loan that finances the building of a home, converting to a permanent mortgage upon completion.
Example
Example: Suppose you take out a $300,000 30-year fixed mortgage at 6.5%. Understanding construction loan helps you see how your monthly payment of approximately $1,896 is structured — and how this concept affects your total cost over the life of the loan. Use our mortgage calculator to see how construction loan impacts your specific situation.