For buyers who want to build rather than buy, construction loans offer a path from empty lot to finished home. Not only that, but they can cover everything from land and permits to materials and labor.

Construction-to-permanent loans are the most common choice, but construction-only loans are also available. Here’s a look at construction loan options and how they work.

Construction-to-Permanent (C2P) Loans

This option funds construction for a fixed term, typically 6 to 18 months. Repayment begins during construction, but payments are made on interest only. Once the project is complete, the loan automatically converts to a traditional 15- to 30-year mortgage, and payments apply toward both interest and principal.

One application and a single set of closing costs can save thousands in duplicate fees.

Construction-Only Loans

Like C2P loans, construction-only loans provide funding for the same fixed term with interest-only payments. But once construction is complete, there is no automatic conversion. You either pay off the loan in a lump sum or secure new, traditional financing.

Construction-only loans offer flexibility on the permanent financing side — you choose your end loan once construction wraps up. The trade-off: you’ll need to qualify twice and cover two sets of closing costs.

Qualifying and Funding

Like traditional mortgages, construction loans require documentation of assets, income and debt. Rates are typically higher due to greater risk to the lender, and a 20% to 25% down payment may be required. Construction loans also require the submission of construction plans, including project timelines and budgets.

Unlike traditional mortgages, funds are disbursed in stages instead of one lump-sum transfer. Builders make draws in installments at key stages of construction, with inspections required for draw approval. Payments are tied to actual progress.

Planning on buying or building your dream home? Reach out if you have any questions about financing.

Weighing your mortgage options? Before making any big decisions, make sure you’re not comparing apples to oranges.

Mortgage rates can be expressed as two different percentages: a nominal interest rate or an annual percentage rate (APR). And while the numbers may look similar on paper, the costs they represent can be significantly different.

Let’s define the terms and put them into proper context.

Interest Rate vs. APR
Interest rate is the percentage a lender charges on the principal balance of a loan annually. APR is the percentage a lender charges on the principal balance of a loan — plus all additional upfront costs. Since the total includes origination fees, broker fees, points and closing costs, the loan amount is technically larger and the APR is typically higher.

While the interest rate applies only to the principal balance, APR reflects the total cost of the loan. Both numbers are important, but APR provides a clearer picture of what you’ll actually pay over time.

Illustrating the Difference
The actual formulas for calculating interest and APR can get quite complicated, but free online calculators can provide a general estimate. Consider this simplified example:

If you purchase a $375,000 home with a 20% down payment ($75,000), your principal loan balance would be $300,000. At 6% interest with fees of $6,800, the APR on a 30-year loan would be approximately 6.215%.

Six percent interest on $300,000 is $18,000 annually, but at 6.215% APR, the amount increases to $18,645. At a glance, that’s not a significant difference, but over a 30-year loan term the costs can really add up.

Compare Carefully
Thanks to the Truth in Lending Act (TILA), lenders are required to disclose both the interest rate and APR on mortgage loans. This information should be listed in each Loan Estimate.

Any questions? Reach out today for helpful answers.

Mortgage rates aren’t what they once were, but buyers are still moving forward. Many are choosing to secure the home they want now, with plans to refinance later if rates improve.

As rates gradually ease, homeowners are starting to revisit those refinancing plans. But if you’ve recently purchased a home, how soon can you refinance your mortgage?

Short answer: It depends.

Lender and Loan Type Matter

Conventional mortgages can be refinanced almost immediately at the discretion of the lender. But a wait of up to 12 months may be imposed. Other loans have more specific requirements:

• Cash-out loans may require up to 12 months of waiting (and 20% home equity).
• FHA loans have a 210-day waiting period and must be in good standing.
• VA loans must wait 210 days, and VA IRRL (Streamline) loans must also provide a “net tangible benefit” such as a reduced rate or lower monthly payment.
• USDA loans require a 12-month wait, 12 months of on-time payments, and must result in a reduced monthly payment ($50 minimum).

When Refinancing Is Beneficial

• Rates have dropped. Refinancing at a lower rate can reduce monthly payments and save thousands of dollars over the life of your loan.
• Your current rate is adjustable. Adjustable-rate mortgages make future interest and monthly costs unpredictable. Refinancing at a fixed rate provides financial consistency.
• Your credit has improved. A higher credit score may qualify you for more favorable loan terms.
• You need cash. Cash-out refinancing uses equity to fund home improvements and other big-ticket purchases.
• Refinancing can also be used to consolidate home loans, add or remove a borrower, and eliminate private mortgage insurance (PMI).

Other Considerations

A new loan means new closing costs, typically 2% to 6%. Refinancing also resets the amortization clock on your loan, which temporarily delays equity accumulation. Prepayment penalties may also apply.

Have any questions? Reach out today.

The right home renovation can improve how your space functions, refresh its look and increase your home’s value. The challenge is that even high‑return projects require money upfront. When paying cash isn’t realistic, financing can make renovations possible without draining your savings.

Here are several common ways homeowners fund renovation projects, along with when each option may make sense.

Tap Into Home Equity

1. A home equity loan lets you borrow up to around 85% of your home’s value minus what you owe. Funds are distributed in a lump sum. This option is ideal for large, one-time projects with a clear price tag, like a new roof. Repayment terms can be up to 30 years with fixed rates and predictable payments.

2. A home equity line of credit (HELOC) allows you to draw funds as needed, typically over a period of 10 years. This is ideal for funding ongoing projects where costs may change over time. You only pay interest on what you borrow, but rates are usually variable, making monthly payments less predictable.

3. A cash-out refinance replaces your existing mortgage with a larger loan, ideally at a lower rate. The cash difference can be used for renovations and other expenses. This is good for funding large improvements to a home you plan on keeping long-term.

Explore Non-Equity Financing

4. Personal loans carry higher rates than equity-based options, but don’t require putting your home up for collateral. Approval is also often faster, which is good for funding urgent repairs. Monthly payments, however, may be higher due to shorter repayment terms (typically two to seven years).

5. Credit cards generally carry very high interest rates, especially compared to other financing options. But a card that offers a 0% introductory rate (usually 12-24 months) can work well for funding smaller projects. Just be sure to pay off the balance before the introductory rate expires.

Ready to renovate? Reach out today to explore your financing options.

Spring and summer are usually the most popular times of year for homebuying. The days are longer, the weather’s warmer and many families hope to move before the next school year begins.

But that popularity also means more competition. With more buyers on the hunt, bidding wars can be more common, and prices often rise as a result.

If you’re planning on buying a home, here’s why winter might actually be the best time to look around and make your move.

1. There’s less competition and more opportunity.

Fewer buyers tend to shop in the colder months, which can mean less competition and fewer bidding wars. Homes may stay on the market longer, giving you more time to make a confident decision without feeling rushed.

2. Sellers are often more flexible.

With fewer buyers knocking at their doors, winter sellers can be more open to negotiation. You might be able to score better pricing, closing cost credits or repair concessions that wouldn’t be on the table during peak season.

3. The mortgage process can move faster.

Since lenders and appraisers often have lighter workloads in the winter, your loan could move through the system more smoothly. That could lead to a quicker (and potentially less stressful) closing process for you.

4. You could save on moving costs.

The winter season doesn’t just slow down the real estate market — it can affect related businesses too. With moving companies and rental trucks less in demand, you may be able to secure lower rates on movers, packing materials and storage.

If you’re thinking about buying soon, now is a great time to explore your financing options. Reach out to get started.