02 May
Construction Loan
Construction Loan In the broadest sense of the term, a construction loan is any loan where the proceeds are used to finance construction of some kind. In the United States Financial Services industry however, the term is used to describe a genre of loans designed for construction and containing features such as interest reserves, where repayment ability may be based on something that can only occour when the project is built. Thus the defining features of these loans are special monitoring and guidelines above normal loan guidelines to ensure that the project is completed so that repayment can begin to take place.