Construction Loans ~ Which are best?
There are two types of construction loans used by homeowners;
1. One-time-close loans
2. Two-time-close loans
With all construction loans, money is disbursed by the lender based on a pre-established construction draw schedule. The goal is to only pay for what has been completed, minus retainage, typically 10% of the cost of the project, which is held back until everything is completed properly and the owner is issued a certificate of occupancy (CO).
One-Time-Close Construction Loans...
This loan has one approval process, and one closing, simplifying the process and reducing the closing costs. Typically, the borrower can choose from the portfolio of mortgages offered by the lender such as 30-year-fixed, or