Construction
One close, and a calendar that respects the frost.
A construction-to-permanent loan closes once, funds the build in draws, then converts to your permanent mortgage. In Montana the hard part is rarely the loan structure. It is the calendar. You have a short season, a booked-out builder, and a rate lock with an expiration date.
Who this is for
People building instead of buying what already exists.
Custom builds on owned ground, lot purchase plus build in one transaction, and major renovation packages where the finished value carries the loan. If you are building because nothing on the market fits the land you want to live on, this is the program.
- Owned lot, plans in hand, builder selected.
- Buying the lot and building in one close.
- Shop or outbuilding included in the build package.
- Tear-down and rebuild on an existing parcel.
The sequence
How it actually works.
01
Builder and plans reviewed
We qualify the builder, review the contract, the plan set and the line-item budget before anything else moves.
02
As-completed appraisal
The appraiser values the finished house from the plans and specifications, not the dirt as it sits today.
03
One closing before the build starts
A single set of documents, a single set of closing costs, and one recorded lien. No second closing later.
04
Interest-only draws
You pay interest only on what has actually been disbursed, so the payment climbs gradually as the build progresses.
05
Inspection at each draw
Work is verified before funds release, which protects you as much as it protects the lender.
06
Automatic conversion
At completion the loan converts to permanent financing on the terms set at the original closing.
What Montana makes tricky
The parts that decline a file somewhere else.
The season
Concrete goes in when the ground allows. A lock that made sense in March is a problem in November.
Builder capacity
Good Montana builders are booked a year out, and the loan has to be built around their schedule, not the other way around.
Cost overruns and change orders
Lumber and labor move. Build contingency in at the start instead of scrambling at draw four.
Well, septic and power
If the utilities are not in yet, the appraisal and the draw schedule have to account for it.
Rate risk over a long build
Talk about extended locks and float-down options before you break ground, not after.
Requirements
Typical numbers.
| Cash to closeLand you already own can count toward equity at appraised value, which often lowers it substantially. | Depends on the build |
|---|---|
| Builder approval | Licensed, insured, references, financials |
| Contingency reserve | 5% – 10% of budget typical |
| Draw scheduleInspection required before each disbursement. | 5 – 8 draws typical |
| Appraisal basis | As-completed value |
| Construction term | 9 – 12 months typical |
| ConversionPermanent terms set at the original closing. | Automatic to permanent |
Typical ranges, not program rules. Construction guidelines vary by investor and by builder profile, and they change often. Bring the plan set and the budget and we will price the real file.
Questions
Asked and answered.
- One. A single-close construction-to-permanent loan means one application, one appraisal, one set of closing costs and one recorded lien. A two-close structure means requalifying and paying closing costs again at conversion, and it exposes you to rate movement across the entire build.
- You pay interest only on the funds actually drawn. Early draws are small, so early payments are small, and they grow as the build progresses. If you are also paying rent or an existing mortgage, we underwrite for both.
- That is the most common Montana problem and it is a planning question, not an emergency. Extended locks and float-down options are set at closing. Runs long enough and extension fees apply, which is exactly why the draw schedule is built against the frost calendar from day one.
- Yes, if the builder qualifies: licensed, insured, a track record on comparable projects, and financials that show they can carry the work between draws. Most established Montana builders clear this without difficulty.
- Rarely, and only with documented construction experience and a licensed sub schedule. Most investors decline owner-builder files. If you are set on it, tell us early so we point you at the right lender rather than burning a month.
Next step
Bring the plans and the build calendar.
Send the plan set, the builder contract and the target ground-break date. We will map the draw schedule and the lock strategy against the season before you commit to a start date.
Opens our secure application at bisonteam.floify.com. About 12 minutes.
Calls our Montana team in Missoula. Direct line, not a call center.