Project Review
The lender evaluates the plans, specifications, construction contract, builder qualifications, budget, and expected completion timeline.
CONSTRUCTION LOAN GUIDE
Build Your Home with the Right Construction Financing
Construction loans may help finance the land, building costs, and permanent mortgage for a new home. Available structures, down payments, and qualification requirements vary by participating lender.
✓One-time-close options
✓Physician programs may be available
✓Terms vary by lender
HOW CONSTRUCTION FINANCING WORKS
From Plans and Land to a Completed Home
A construction loan funds an approved building project in stages. The lender typically reviews the plans, budget, builder, appraisal, and borrower qualifications before closing.
Loan Closing
Approved financing may cover eligible land costs, construction expenses, and other permitted project costs, subject to lender limits.
Construction Draws
Funds are released in scheduled draws as work is completed and verified through inspections or other lender-required documentation.
Permanent Financing
After completion, the loan may convert to permanent mortgage financing or require a separate permanent-loan closing, depending on its structure.
ONE-TIME VS. TWO-TIME CLOSE
Understand the Two Common Structures
A one-time-close construction-to-permanent loan combines construction and permanent financing into one transaction. A two-time-close structure uses a construction loan first and a separate permanent mortgage after the home is completed.
Explore potential program matches →✓One-time close may reduce duplicate closing steps
✓Two-time close may allow permanent financing to be selected later
✓Rate-lock terms and modification options vary
✓Additional underwriting may be required if circumstances change
COMMON ELIGIBILITY FACTORS
What Participating Lenders May Review
Construction financing involves both borrower underwriting and project approval. Requirements differ by lender, program, property, builder, and loan amount.
Credit and Income
Lenders may review credit history, qualifying income, employment, debts, assets, and reserves.
Down Payment or Equity
Required borrower investment may depend on the loan amount, property use, land equity, and program guidelines.
Builder Approval
The builder may need to provide licensing, insurance, financial, experience, and project documentation.
Plans and Budget
Detailed plans, specifications, contracts, allowances, contingency funds, and a draw schedule may be required.
Completed-Value Appraisal
An appraisal generally estimates the property value as if the proposed home were fully completed.
Reserves and Contingencies
Some programs require funds for reserves, cost overruns, interest payments, or other unexpected expenses.
PHYSICIAN CONSTRUCTION OPTIONS
Specialized Programs May Be Available
Some lenders extend physician mortgage features to construction-to-permanent financing. Depending on the program, eligible medical professionals may encounter different down-payment, mortgage-insurance, employment-start-date, or student-loan guidelines.
Availability depends on profession, career stage, state, property use, loan amount, builder, project, and lender requirements.
✓Physicians, dentists, or other eligible professionals
✓Primary residences and, with some lenders, second homes
✓Fixed-rate or adjustable-rate permanent financing
✓Program-specific maximum loan amounts and loan-to-value limits
BEFORE YOU APPLY
Information Worth Gathering Early
Early preparation can help a lender evaluate both the financing request and the proposed construction project.
✓Purchase contract or documentation showing land ownership
✓Builder contract, plans, specifications, and estimated budget
✓Expected construction start date and completion timeline
✓Income, employment, asset, and liability documentation
✓Questions about rate locks, draws, inspections, change orders, and cost overruns
EXPLORE YOUR OPTIONS
Find Construction Programs That May Match Your Needs
Answer a few questions about your profession, property, and financing goals. BestDoctorLoans.com may connect you with participating lenders offering potentially relevant programs.
BestDoctorLoans.com is an educational and lead-generation platform, not a lender or mortgage broker. Program availability, qualification requirements, rates, fees, and terms are determined by participating lenders and may change without notice.