It’s one thing to dream about building a custom home for your family. Figuring out how to pay for it can be harder. At Peoples Bank, we strive to be a resource for you. If the construction financing process seems intimidating, we are here to help. Whether you are a farmer looking to build a new home on your land, or a young couple or family who just purchased a lot to build on, we can help you keep the construction process running as smoothly as possible with a construction loan from Peoples Bank.
What is a Home Construction Loan?
Personal construction loans offer short-term financing for the costs associated with building a new home. You can also use a home construction loan to make improvements or add an addition to an existing structure. Construction loan terms may vary depending on the project, but the average is one year. Once the work is completed, Peoples Bank will convert your construction loan into permanent financing. The benefit of a single close construction loan is that you avoid the hassle and cost of a second closing when it’s time to obtain permanent financing.
How do Home Construction Loans work?
Instead of a lump sum payment like you’d get from a conventional mortgage, construction loans provide capital as needed. As work progresses and your contractor submits invoices, Peoples Bank will advance funds to pay the invoice totals. You only pay interest on the amount borrowed.
To apply for a construction loan, you’ll need to provide supporting documents such as a construction timetable, builders contract, detailed plans, and a budget. Our Mortgage Experts will help you through the application process.
Benefits of a Construction Loan
- Interest-only payments make it affordable to build your dream home.
- Competitive rates and flexible terms.
- Borrow only as much as you need.
- Interest accrues only on what you borrow.
Why choose Peoples Bank for Home Construction Loans?
As a community bank, we are committed to providing fairly priced and up-to-date banking services. We tailor everything to meet your specific needs. At Peoples Bank, our mission is to exceed our customers’ expectations. To learn more about construction loans and our other personal financing options, give us a call or visit your nearest Peoples Bank location in Rock Valley, Lester, Sioux Center, Akron, Sheldon, Hawarden, Hinton, or Sioux City, IA, Jasper, MN, and North Sioux City, SD.
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