A property construction loan differs from other types of credit. The most likely cause is looking for property construction loan for the construction of homes or commercial buildings from scratch. If you want to expand an existing property, you should make sure you can refinance your current mortgage, rather than looking for a construction loan. Why? The process of obtaining - and services - property construction loan probably involves more traps and pitfalls than any other type of loan. You must be very confident that you accept, and do your homework carefully before rush into anything. So are some of the things you need to make sure if you are going for the construction loan. 1. Get pre-qualified for the loan before doing anything else - that is before you even get land. This will help you to be clear that the budget will be - and know whether you can really afford it in the first place! 2. Looking round for the right lender can be a headache. Just about any creditor will be happy to offer you the real estate construction loan, but that does not mean that you have to take the first thing that comes. One way is to find an experienced broker who specializes in construction loans. A good broker will be able to provide useful advice, and find a loan that is suitable for your needs. 3. Until recently, the only type of construction loan can be obtained for six months or twelve months, short-term loans to be refinanced mortgage at the end of the period. This, of course, means a lot of two pre-qualifying, two much closure costs, etc. Do not think that any creditor who is now indicates that this is all you can get. Ideal loan you want to take a look at this once-close, build-to-permanent loan, which allows consolidate low interest rates in advance. (Avoid lenders who impose higher rates if the castle in advance.) 4. Once you have identified possible creditor, check the level of experience lending officer, or regardless of who is with you called. Pilot Officer borrowing is one of the most important criteria for choosing a creditor. Remember that the loans give you a member of loans process as soon as possible, so that they can get to the next borrower, so that an inexperienced person can make a mistake that could cost you dearly. Keep your eyes open at each stage of the process. For example, the view that loans officer locks in your rate right - wrong doing this is a common mistake. 5. Always get a full quote in writing and carefully examine it to make sure it is the same as the address you originally promised. It is not uncommon for the lender to try to leave your palms less good conditions than advertising. 6. Construction projects are known to occur over time and over budget. Ask if there is the possibility of including a pool, as part of your loan. A reserve can be tied to the loan, either in the form of in Coningency or as a borrower Reserve. In Builders Reserve would allow builders to draw from this fund for cost overruns etc. 7. You will need to obtain details of the construction costs to be submitted at the beginning of the process. In addition, the lender will probably want to resume or outline builder experience, and may also make a credit check builder be sure that they pay their bills. 8. To be able to predict the viability of the project, you need a good knowledge of the area - transportation, schools, health care, etc. creditor will need this information as well as your research before you start. 9. The property construction loan needs three separate allegations - themselves, and the builder of the project - so, normally takes longer than normal credit. Allow up to six weeks. 10. Finally, you must ensure that you keep control over the project - i.. E. verify that the credit for himself, not for the builder. The last thing you want to find a few weeks after the completion of the project, which is not one of the subcontractors have been paid and placing mortgage on the house, preventing the transfer of title. In the subcontractor could sue and redemption to recover unpaid goods and services. As you can see, to get a property construction loan can be a potential minefield! However, following these tips, you should be able to circumvent the most difficult issues and to ensure the success of your project.