construction
Construction Loans

Build your home with confidence.

When it's time to build your new home, our construction loan provides a clear, structured way to finance the build of your new home—with guidance from start to finish.

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financing your build

What is a Construction Loan?

A construction loan is a short-term loan used to finance the building of a new home. Instead of receiving the full loan amount upfront, funds are released in stages—often called draws—as construction progresses. During construction, borrowers typically make interest-only payments. Once the home is complete, the loan is financed into a permanent mortgage.

How Construction Financing Works:

Apply and get approved.
We review your financial information, construction plans, property details, and builder qualifications upfront.
We fund your build as it progresses.
Loan funds are released in stages as construction milestones are completed. Inspections are required before each disbursement to confirm progress.
Make interest-only payments during construction.
Payments are interest-only and based on the amount of funds disbursed—not the full loan amount—this helps to manage your cash flow during the build.
Finalize permanent financing.
After construction and final inspections are complete, your Mortgage Loan Officer will help you select a permanent financing option that fits your needs.
ELIGIBILITY REQUIREMENTS

Clear guidelines with no surprises later.

Eligibility properties include:

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Primary residences only
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Single-family residences
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Planned Unit Developments (PUDs)
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Townhomes

The following are not eligible:

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Second homes
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Investment properties
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Spec homes
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Self-build projects where the borrower acts as general contractor
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Connect with an expert

Ready to get started?

If you’re planning to build a new home, we’re here to help you understand your options and prepare for what’s ahead. Speak with a Texas Tech Credit Union Mortgage Loan Officer to confirm eligibility and see if a construction loan is right for your build.

Connect with a Mortgage Loan Officer

Frequently Asked Questions

1

How do construction loan payments work?
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During construction, payments are typically interest-only and based on funds that have been disbursed. Full principal and interest payments begin once construction is complete, and the loan is financed into a permanent mortgage.

2

What happens after construction is complete?
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After final inspections and completion, the construction loan is financed into a permanent mortgage.

3

Do I need to own land already?
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No. You can purchase the land as part of the construction loan.

4

Can I choose my own builder?
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Yes. However, builders must meet certain requirements, and our team will coordinate directly with them throughout the process.

*Important Info
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* Property location eligibility applies. Contact a Mortgage Loan Officer to confirm whether a specific location qualifies.