Construction &
Building Loans

Handling the financial side of building a new home can be challenging, but it doesn’t have to be. Core Bank is here to help you through the financial obstacles of home construction so you can focus on building your dream home!

Home » Personal » Borrowing » Build

Helping You Build Your New Home

Our team of loan professionals is here to help you every step of the way as you navigate the ups and downs of new home building. With the right construction and lot loan, you’ll be able to cover the cost of the land, contractor labor, building materials, and permits, as well as contingency costs that come up during construction. Let us walk you through understanding how different personal building loans work, different interest rates, loan requirements, and more!

Construction & Building Loan Options

Whether you’re getting ready to build a new home or you’re just looking to secure the land necessary to build, Core Bank’s construction and building loan options can help you do both! Learn more about our different loan options today.

Home Construction Loan Options

Construction-Only Loans

Construction-only loans cover the costs necessary to complete the building of the property, but the borrower is responsible for paying the loan in full at maturity or obtaining a mortgage.

Renovation Loans

When home buyers prefer to update an existing building rather than build a new one, renovation loans help them secure the necessary funds.


Lot Loans

Lot loans are money given to a borrower to purchase a primary or secondary residence. The money from a land lot loan is used to finance the purchase of the land that the borrower will build on. The land being purchased with a lot loan must be suitable for residential development.

Why New Home Construction Loans Are Important

Building or restoring a home is a significant commitment that requires a good amount of time and money. Construction loans help borrowers cover the cost of the land, contractor labor, building materials, and permits. They can also include a contingency reserve to cover unexpected costs that might arise during construction. These costs add up and can be difficult for the buyer to afford alone. Construction loans help buyers overcome financial obstacles to build the home of their dreams.

How to Get a Residential Construction Loan

Get in touch with a loan officer at Core Bank and we’ll help you through the application process. You will need to provide your basic debt, income, and asset information, as well as a signed construction or purchase contract with your builder or developer. This contract must detail the contract amount and construction start date and completion date.

Building Loan FAQs

What is lot land?

Lot land is land specifically designated for a residential property. This land is suitable for development and likely has utilities like water, electricity, and gas on site or nearby. Lots come with a building permit or appropriate zoning and typically have access to public roads.

What are the financing options for a lot loan?

You can finance a lot loan with or without your mortgage. Your other options are home equity, personal loans, seller financing, conforming loans, USDA loans, VA loans, and local lenders.

How much money must be put down for a lot loan?

Land loans tend to require larger down payments than traditional mortgages. You often put down as much as 20-30% of the asking price, though figures vary on a case-by-case basis.

Why do construction loans have higher interest rates than traditional mortgage loans?

Due to cost overruns, accidents, delays, and other problems that often accompany construction jobs, there is more risk associated with construction loans, thus they carry higher interest rates.

How long do construction loans last?

Residential construction loans last as long as it takes to build the home, which is typically one year or less.

Why do construction loans have variable rates?

Unlike a traditional loan in which the mortgage company covers the cost of the loan in a lump-sum cost, construction loans are paid out in installments called “draws.” Each draw reimburses the builder for the costs needed to cover that phase of the building, which varies depending on the materials and labor needed to complete that aspect of the project.

What’s the difference between construction loans and owner-builder construction loans?

While construction loans go through a general contractor, in owner-builder loans the homeowner assumes the responsibilities of planning and building the house. Lenders tend to see owner-builder loans as very risky, which makes these loans difficult to obtain. Most lenders prefer you to leave the work to professionals through a construction loan.

Find a Core Bank Near You

Core Bank proudly offers personal and business banking solutions made for you. With banking centers in Omaha, Overland Park, and Mesa, we’re here to help you borrow and save confidently. Discover your nearest Core Bank today!

Get Pre-Qualified

Ready to apply for a loan from Core Bank? Get pre-qualified now! Simplify the entire loan process online, without having to stop into a local Core Bank Branch.

Contact Core Bank

Ready to get started building your dream home? Talk to one of our friendly loan professionals at Core Bank today, and we’ll get you started with the construction or lot loan that’s right for you!

Apply Now

Don’t wait until tomorrow to apply for the loan you need today. Get started on the application process now!