Construction-to-Permanent Loan Calculator
Calculate construction loan interest during building phase and permanent mortgage conversion
About this calculator
A Construction-to-Permanent Loan Calculator helps you estimate the total costs of financing a custom home build from start to finish. This tool calculates interest payments during the construction phase when you only pay interest on drawn funds, then shows your permanent mortgage payments once construction is complete. It's essential for budgeting accurately and understanding how much you'll pay throughout both phases of this unique financing option.
How to use
Enter your total loan amount, construction timeline, interest rates for both phases, and expected draw schedule. The calculator will show your monthly interest-only payments during construction and your permanent mortgage payment afterward. Compare different scenarios by adjusting loan terms and rates.
Frequently asked questions
How does interest work during construction?
You only pay interest on funds actually drawn from the loan, not the full amount, which keeps initial payments lower during building.
What happens when construction is finished?
The loan automatically converts to a permanent mortgage with principal and interest payments based on your agreed terms.
Can I lock in my permanent mortgage rate?
Many lenders offer rate lock options for the permanent phase, protecting you from rate increases during construction.