Financing Your Build
Construction Loans & Custom Home Financing
Financing a custom home is different from buying an existing one — but it doesn't have to be complicated. Here's how it works, what your options are, and how we help simplify the process.
How Construction Financing Works
Unlike a traditional mortgage, a construction loan funds the build in stages. Here's the process from pre-qualification to move-in day.
Get Pre-Qualified
Before design begins, connect with a construction lender to understand your budget range. We can introduce you to lenders who specialize in custom home construction in Oregon.
Design Within Budget
Our design-build model means your construction budget informs every design decision. There's no moment where you discover the design costs more than you can finance.
Appraisal & Approval
The lender orders an appraisal based on your plans and specs. Because we provide a fixed-price construction agreement, the lender has clear documentation of exactly what's being built and for how much.
Draw Schedule
During construction, the lender releases funds in stages (draws) as milestones are completed. You typically pay interest-only during the build period — keeping monthly payments lower.
Conversion or Refinance
When construction is complete, your loan either converts automatically (one-time close) or you close on your permanent mortgage. Move in, and start making regular mortgage payments.
Your Financing Options
Most custom home buyers use one of these three approaches. Each has advantages depending on your situation.
Construction-to-Permanent (One-Time Close)
The most common option for custom home buyers. You close once, lock your rate upfront, and the loan converts to a traditional mortgage when construction is complete. One set of closing costs, one appraisal, one process.
- Single closing — lower fees
- Rate locked before construction
- Seamless conversion to mortgage
Best for: Buyers who want simplicity and rate certainty.
Stand-Alone Construction Loan
A short-term loan that covers the build, then you refinance into a permanent mortgage at completion. This gives you flexibility to shop for the best permanent rate after the home is built — but requires two closings.
- Flexibility on permanent financing
- Can shop rates at completion
- May qualify for larger build budget
Best for: Buyers who want maximum flexibility or expect rates to drop.
Land Equity as Down Payment
If you already own your lot, many lenders will count its appraised value toward your down payment. This can significantly reduce or eliminate the cash you need upfront — a major advantage for land owners.
- Reduces cash out-of-pocket
- Land value counts as equity
- Stronger loan position
Best for: Buyers who already own land — our most common client profile.
Why Lenders Prefer Design-Build
Our Model Makes Financing Smoother
Lenders need clarity: what's being built, who's building it, and how much it will cost. In a traditional architect-then-builder approach, those answers come from different parties — and sometimes conflict.
With Creekside, one team provides one set of plans with one fixed-price construction agreement. That single-source documentation makes the appraisal and underwriting process significantly smoother.
Financing Questions We Hear Often
How much down payment do I need?
Most construction loans require 20–25% down. If you own your land, its appraised value typically counts toward that requirement — often covering most or all of it.
What credit score do I need?
Most construction lenders look for a minimum score of 680–720. The higher your score, the better your rate and terms. We can connect you with lenders who specialize in this space.
Do I pay the builder directly?
No. The lender pays the builder through a draw schedule tied to construction milestones. An inspector verifies work completion before each draw is released. This protects you and the lender.
What if I already own land free and clear?
That's the strongest position to be in. Your land equity serves as your down payment, and you may not need any additional cash at closing depending on the loan-to-value ratio.
Can you recommend a lender?
We work with several construction lenders in Oregon who understand custom home builds. During our initial consultation, we'll connect you with lenders who are a good fit for your situation.
Ready to Build with Confidence?
One conversation is all it takes to see if we're the right fit. We'll walk through your vision, your land, and your timeline — and be honest about what it takes to get there.