When building homes, lenders often lend out a construction loan to help with the initial costs.
The idea is to use the money to pay off some of the principal of the loan.
The problem with this is that a loan can be much more risky if you’re the one paying for the loan and you don’t have the financial resources to pay the loan off yourself.
The risk is that you could have to take on more debt and potentially pay it off faster than you can repay it.
In order to minimize this risk, many lenders offer construction loan terms that are less than traditional home construction loans.
Here are a few things you should know about construction loans: Loan terms and repayment rates are different for construction and conventional home loans.