Construction Loan Help

About Construction to Permanent Loans

What is a Construction-to-Permanent Loan?

A Construction-to-Permanent Loan is two loans in one. Unlike buying an existing home, financing the building of a new home includes a construction phase, the period of time your new home is being built. Once construction is complete, a permanent mortgage is needed. Our Construction-to-Permanent Loan includes both the construction phase and the permanent mortgage. This is why it’s called a Construction-to-Permanent Loan.

What is "one-time close" and how does it save time and money?

One-time close means with one construction loan application, one loan qualification and one loan closing, you get all the financing you need—a construction loan to build your home and a permanent mortgage when construction is complete. Best of all, you only pay one set of closing costs. And there are no payments during the construction phase1 so you can spend your time focusing on your new home construction project.

What do you mean by "no-payment" Construction-to-Permanent Loan?

As part of your Construction-to-Permanent Loan budget, we establish an account to pay the estimated interest costs during the construction of your home. This way you make no monthly payments during construction unless your interest reserve account is depleted before completion of your project. We like to think of it as a worry-free mortgage!

How does the construction loan process work?

The Construction-to-Permanent Loan process is similar to the process of a standard home purchase or refinance transaction. But, unlike a purchase transaction for an existing home, a Construction-to-Permanent Loan involves determining the value of a home that is not yet constructed. In determining the future value of your new home, we request information on the planned improvements and construction costs.

Once I get started how do I access my funds?

Unlike a standard purchase mortgage, a Construction Loan is disbursed in the form of payments (or "draws") as each phase of construction is completed. At Indymac Bank, we have revolutionized the Construction Loan disbursement process by allowing you easy access to your Construction Loan account online through our Construction Service Center website.

From our lender's website, you can request a disbursement, check your inspection results, review your statement and much more, safely and conveniently, anytime of the day or week.