Skip to Content

Preferred Branch

Mason City (641)423-1600 Change Location

Your Preferred Branch

Mason City Change Location

2601 4th Street SW
Mason City, IA 50401


Monday-Thursday: 9:00am - 4:00pm
Friday: 9:00am - 5:00pm
Sat: 9:00am - 12:00pm
Get Directions

Change Preferred Branch

  • Charles City Branch
    300 North Main Street - Charles City

  • Clarion Branch
    315 Central Avenue East - Clarion

  • Kanawha Branch
    220 North Main Street - Kanawha

  • Latimer Branch
    119 North Akir Street - Latimer

  • Mason City State Street Branch
    33 East State Street - Mason City

  • Mason City West Branch
    2601 4th Street SW - Mason City

  • Mora Branch
    730 Forest Ave East - Mora

  • New Hampton Branch
    124 West Main Street - New Hampton

  • Osage Branch
    501 Main Street - Osage

mail icon Search Icon Menu


Start navigating site here or scroll down

Home Blog Did You Know First Citizens Offers Residential Construction Loans?

Did You Know First Citizens Offers Residential Construction Loans?

Did You Know First Citizens Offers Residential Construction Loans?

Realizing your dream home probably requires obtaining a mortgage. But what if you want to build your dream home on a specific lot of land, build an addition, or tackle a major renovation? If this sound appealing to you, you may want to consider getting a residential construction loan that’s designed to help you with home construction financing. This type of loan is a short-term loan up to eleven months and is used to pay for the cost of building or remodeling a home. It allows for multiple advances (construction draws) to accommodate the construction process and interest is paid monthly on the amount(s) borrowed. 

As with Home Loans, one size does not fit all with residential construction loans. There are two main types of residential constructions loans that First Citizens offers:

  1. Stand-alone construction loans
  2. Renovation construction loans

Construction loans for new homes are set up for no more than eleven months. Funds are advanced for contractor invoices as they occur. A certified appraisal is completed for a projected value of the home upon completion to determine the size of the loan.  Once you complete the home and are set to move in, the construction loan will be refinanced into a term loan of 15 years, 20 years, or 30 years. 

A renovation construction loan is set up to help with a large remodel project of your home. With a renovation construction loan, you have funds set up to cover the costs of the project to be available as contractor invoices occur.  At the end of the project, the renovation construction loan will be combined with your present home loan and termed out again over 15 years, 20 years or 30 years.  The projected value of the house after renovations will determine the size of the loan.
For the loan approval process, here is a list of documentation you will need:

  • If you own the land, proof of ownership
  • A copy of the contract to purchase the land if you don’t already own it
  • Your contract with the builder or estimates for the renovation
  • Complete information on your builder, including name, address, phone number, etc.
  • Building plans and specifications
  • Proof of insurance from the builder
  • Proof of insurance covering the project
  • Documentation of your income, such as W-2s, tax returns and pay stubs
  • Authorization to perform a credit check
  • Information on your debts so First Citizens can calculate your debt-to-income ratio

As with traditional mortgages, your credit score plays a very important role in securing the loan. The higher your score is, the higher your chances of being approved. You should also be prepared to have a down payment of 20 percent for the loan. This down payment serves as a secure deposit and ensures you are sincerely invested in this project. It’s important for the borrower to have a significant cash cushion when seeking a construction loan just in case the project runs over budget.

Building the home of your dreams can be an incredible experience. Now that you know the basics, we invite you to contact any of our Home Loan Lenders with any residential home loan questions you may have. Ready to apply for your loan? Click here to begin the process.


Contact Us
Back to Top