Shared by Ed Currie of Associated Bank
The construction phase is the period of time your home is under construction. Once your home is complete, the loan moves to the permanent phase with payments of principal and interest.
Every construction phase is initially setup for 12 months. If you use less time, the loan will move to the permanent phase once your home is done. So you can’t ride out an interest only payment for the full 12-month period. Once it’s complete, the payment changes from interest only to principal and interest. If more time is needed, a one-time extension of up to 6 months can be obtained if requested at no charge.
Meet the Author ...
Ed Currie began assisting clients with mortgage financing in 1994 during one of the slowest mortgage markets in the last 25 years. The slow market allowed Ed to develop his client-centric philosophy and drive to make the process as stress-free as possible. Since that time, Ed has assisted over 5000 clients with total loan production exceeding $1 Billion.