Construction Loans
Build or Renovate Your Home with Flexible Financing
Construction loans allow you to finance the building or major renovation of a home from the ground up. Instead of taking out separate loans for land, construction, and the final mortgage, construction loan programs let you combine everything into a single, streamlined loan.
Two of the most common options are Conventional Construction Loans and FHA Construction Loans — each designed for different borrower needs and financial profiles.
Conventional Construction Loans
A conventional construction loan is ideal for borrowers with strong credit who want flexible financing to build or extensively renovate a home
Key Features:
- One-time close construction-to-permanent loan
- Finance land purchase, construction, and final mortgage in one loan
- Fixed-rate or adjustable-rate options
- Real estate investors with strong cash flow
- No upfront mortgage insurance
- No upfront mortgage insurance
- No upfront mortgage insurance
Best For:
- One-time close construction-to-permanent loan
- Finance land purchase, construction, and final mortgage in one loan
- Fixed-rate or adjustable-rate options
- Real estate investors with strong cash flow
FHA One-Time Close
FHA construction loans are designed to help buyers with lower down payments or more flexible credit qualify to build or renovate a home
Key Features:
- Low down payment (as little as 3.5%)
- Buyers with credit challenges or limited credit histor
- Those with limited savings for a down payment
- Borrowers recovering from past financial hardships
- Want a simpler qualification process than traditional loans
Best For:
- First-time homebuyers
- Buyers with credit challenges or limited credit histor
- Those with limited savings for a down payment
- Borrowers recovering from past financial hardships
- Want a simpler qualification process than traditional loans
Conventional vs. FHA Construction Loans — Quick Comparison
Feature
- Minimum Down Payment
- Credit Flexibility
- Mortgage Insuranc
- Loan Limits
- Property Use
- Best For
Conventional Construction
- Minimum Down Payment
- Credit Flexibility
- Mortgage Insuranc
- Loan Limits
- Property Use
- Best For
FHA Construction
- Minimum Down Payment
- Credit Flexibility
- Mortgage Insuranc
- Loan Limits
- Property Use
- Best For
Which Construction Loan Is Right for You?
Choose a Conventional Construction Loan if you have strong credit, want higher loan limits, or are building a higher-end or custom home.
Choose an FHA Construction Loan if you need a lower down payment, more flexible credit guidelines, or want a more accessible way to finance a home build or major renovatio