What are the benefits of construction loans?
Construction Loan Rates
When it comes to financing a new construction project, one of the most critical factors to consider is the interest rate on the construction loan. Construction loan rates can vary widely depending on a variety of factors such as the size of the loan and the length of the loan term. Generally, construction loan rates are higher than rates for traditional mortgages, as they are considered to be riskier for lenders. In the context of construction loan rates, borrowers may be able to lock in a lower rate by securing a fixed-rate construction loan rather than a variable-rate construction loan. It’s also worth noting that borrowers have the option to lock in their rate prior to closing; fees, terms and conditions apply to rate locks. A rate lock secures the rate for the life of a fixed-rate construction loan, even when transitioning from the construction phase to the permanent loan phase. Ultimately, this not only streamlines the process, but removes the stress of a changing rate during construction.
Construction Loan FAQs
What do I need to start the construction loan process?
What is the required down payment for construction loans?
What is the maximum construction loan amount?
Can the land I already own be used as a down payment for a construction loan?
Does a construction loan cover appliances?
How can I get home loans for the house I’m planning to build?
Contact Kennebunk Savings Today!
Learn more about how to get a construction loan directly through our bank to help with any financing you need to purchase land, construct a home, and much more!