Construction-to-Permanent Loan
Defined by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker
A construction-to-permanent loan finances both the building of a new home and the long-term mortgage in a single loan with one closing.
What Construction-to-Permanent Loan means
During construction, the borrower pays interest only on funds drawn. When the home is finished, the loan converts to a standard mortgage without a second closing or set of fees. It streamlines new-build financing.
Florida example
A buyer building a custom home near Ocala used a construction-to-permanent loan, paying interest on draws during the build, then converting to a 30-year fixed mortgage at completion.
What it is
A construction-to-permanent loan funds the build and then converts to a regular mortgage. It combines two loans into one closing.
You save the cost and hassle of closing twice.
Who it fits
It suits buyers building a new home who want one simple loan. Draws pay the builder as work is completed.
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