Home Financing
Paying for it, explained.
Construction loans, renovation loans and draw schedules, in plain language — plus the paperwork your lender will want from us.
Straight up
We're builders, not lenders.
Beach Star Construction doesn't lend money, broker loans, or take a cut from anyone who does. What we can do is explain how construction financing usually works, tell you what a lender will ask us for, and hand you names of local people who do this every day.
Nothing on this page is financial advice, and rates, programmes and eligibility change constantly. Take the specifics to a licensed lender or a financial adviser before you commit to anything.
What follows is just the shape of it, so you're not walking into that conversation cold.
The options
Four ways people usually fund a build.
Which one fits depends on whether you own the land, whether you're living in the property, and how much equity you already have.
Construction-to-permanent
One loan that funds the build in stages and then converts into an ordinary mortgage when the house is finished. One closing, one set of costs. The most common route for a ground-up custom home.
Stand-alone construction loan
Short-term, interest-only during the build, repaid by refinancing into a mortgage at the end. More flexibility on who you end up with as a long-term lender, but two closings.
Renovation loans
Products designed to lend against the value of the home after the work, rather than what it's worth today. Useful when the renovation is what unlocks the value. Programme rules are strict about scope and contractor documentation.
Equity, cash-out refinance or cash
If you have equity or savings, this is usually the simplest and cheapest path — no draw inspections, no programme rules, and you keep control of the schedule.
Draw schedules
The money arrives in stages. Here's the rhythm.
You don't get handed a cheque for the whole build. The lender releases funds as the work is verified — which is a protection for you as much as for them.
Schedule of values
Before anything starts, we break the contract into stages with a dollar value against each. That document is what the whole draw process runs on.
Stage completed
We finish a stage — slab, shell, dry-in, rough-ins, drywall, finishes — and submit a draw request with photographs and lien releases.
Inspection
The lender sends an inspector to confirm the work is actually there. We meet them on site and walk it with them.
Funds released
The draw is paid, subcontractors and suppliers are paid, and the next stage starts. Repeat until hand-over.
Before you apply
Get the build priced first.
Almost every construction lender wants the same package before they'll do anything meaningful: a signed contract with a fixed price, a full set of plans and specifications, a schedule of values, a realistic timeline, and evidence your builder is licensed and insured.
People often go to the bank first, get a number in their head, and then find the build doesn't fit inside it. It's less painful the other way round — get the quotation, then go and borrow against something real.
Questions
Financing, briefly.
Not necessarily. Some construction loans can include the lot purchase; others expect you to own it already, in which case the land's value often counts toward your equity. Your lender will tell you which applies.
Yes — there are loan products built specifically for renovation, which lend against the projected value once the work is done. They come with tighter rules about scope changes and contractor paperwork, so the quote needs to be right before you apply.
The loan amount is generally fixed at closing, so overruns come out of your pocket or out of a contingency you set aside at the start. That's exactly why our quotes are itemised and why change orders get priced and signed before the work happens. Most lenders want to see a contingency of a sensible size — ask yours what they expect.
We'll happily give you names of local lenders and brokers who handle construction lending on the Gulf Coast regularly. We don't take referral fees and we don't have a preferred partner — talk to two or three and compare what they offer.
Beach Star Construction is a building contractor. We are not a lender, mortgage broker or financial adviser, and nothing on this page is financial advice or an offer of credit. Please take decisions about borrowing to a licensed professional.
Next step
Start with the number you're actually borrowing against.
A free, itemised quotation gives you something concrete to take to a lender.