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Builder mortgages

Author: The Mortgage Girl |

This type of financing is for the construction of a new home. The two common types of mortgages available are “draw” or “completion”. A draw mortgage is when your mortgage finances the build and interest is paid on those draws during the construction period. Once the build is 100% complete, the loan becomes a standard mortgage. A “completion” mortgage is when the builder will finance the construction of the home to 100% completion and you only start making payments when the home is 100% complete. Qualifying for a construction loan might be a more tedious process because of the additional paperwork.