Loan Types / Construction
Construction Loan Calculator
A construction loan finances building a home, then converts to a standard mortgage. Learn how draws work and estimate the permanent payment with the calculator.
Open the calculatorAd space
How construction loans work
- Two phases: a short-term construction phase, then a permanent mortgage.
- Draws: funds release in stages as the build hits milestones.
- Interest: often interest-only during construction, on the amount drawn.
- Conversion: a one-time-close loan rolls into a permanent FHA, VA, USDA, or conventional mortgage.
Estimate the permanent payment
Once built, the loan behaves like a standard mortgage. Use the calculator with your expected loan amount and rate to estimate the long-term payment, then talk to a loan officer about the construction phase.
See your real numbers. The calculator estimates this loan next to every other type, side by side.
Open the calculator Read the full guide
Frequently asked questions
What is a construction loan?
A short-term loan that funds building a home in stages, then converts to a permanent mortgage once the home is complete.
How do construction draws work?
The lender releases money in stages as the build reaches milestones, and interest is often charged only on the amount drawn.
Can I get one loan for build and mortgage?
Yes, a one-time-close construction-to-permanent loan combines both, which reduces closing costs and paperwork.
What down payment do construction loans need?
It varies by program and lender. A loan officer confirms the requirement for your build.
Important disclosures. LoanFitCalc is a free educational tool that provides estimates only. It is not a loan, a loan approval, a commitment to lend, a rate lock, or an offer to make a loan, and it does not provide financial, legal, or tax advice or recommend a specific loan for you. Mortgage insurance rates, funding and guarantee fees, loan limits, taxes, and insurance figures are typical published values used for estimation and are subject to change. Program eligibility rules are summarized and simplified. Actual terms depend on your full application, credit, property, and lender underwriting. Consult a licensed mortgage loan originator before making any decision. LoanFitCalc is an independent educational website and is not a lender. ⌂ Equal Housing Opportunity
