Construction Home Loans
Construction Home Loans is specially designed for peoples who need to build their own home.
Many peoples prefer to build a newly home rather than buy a home. Why? Because they can engage Architect to design the shape and style of the home they like. Build according to their desire.
If land acquired by you, you may use it as equity for the loan.
Facts of Construction Loans
- Its always associated with the short period, ranging about 6 to 24 months.
- Approval of the loan is depending on you, contractor and the lender. Contractor will advice on the construction period & progress stages, every stage need certain amount of money to generate the progress until completion. After proposed to lender, they will evaluate it. Either approve & disapprove.
- The loan can be made in short time if you willing to repay it by a higher interest rate.
- You may convert the loan into a mortgage home loan, if you need to prolong the installment period with lower interest rate.
Be prepared for getting Construction Loan
You are advice to have a good research before taking this loan. Different lenders may offer different rates & terms.
These loans are beneficial for building new home, investing for new home and major renovation for existing home. Factors like design, consultation, building fee, construction cost are all count in total expenditure on the new home. This information will allow you to have a brief guideline on how much money need to borrow from lender.
Fixed rate & adjustable rate
Like other home loans, these loans also with 2 options fixed rate and adjustable rate. During construction the rate may be fixed, when the construction loan change to home loan, the loan may carry a flexible rate of interest.
other option also available, during construction period just pay for the interest only and the balance amounts become the home loan, the installments are fixed based on this home loan after the construction is over.
For other loans information, I suggest you to check out
Home Loans instead of Construction Home Loans
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