The Cooperative Bank of Cape Cod offers construction loan financing for you to build your custom home, renovate your current home, or upgrade your home with other major projects. Whether you’re turning your basement into livable space or adding a dormer to your upstairs, our loan experts know Cape Cod and are well-versed with the ins and outs of the construction process. Together we can help you find the best and most cost-effective loan option.

How do construction loans work?

Construction loans are typically short-term loans designed to help you buy land and build your dream home, build on land you already own, or renovate your current home. Construction loans offer conventional and jumbo financing for primary and second homes. Down payments are from 5% to 30%, depending on the scope of your work. When construction is finished, the loan can be refinanced or converted into a permanent mortgage. At the conversation time for the loan, you can choose either a fixed-rate or adjustable rate (ARM).

Key benefits:

  • ConstructionFixed & Adjustable rate options available
  • Available for the construction of your primary or secondary residence
  • Jumbo Loan amounts available
  • One-time closing fee
  • Land purchase can be included in costs
  • Licensed contractors and builders risk insurance required
  • Interest only during the construction period (up to 12 months)


Construction Loan FAQs

  • What does a construction loan cover? Projects can vary, but in general, construction loans cover land, fees, permits, labor, materials, and closing costs.
  • Do I need to have a down payment? Yes. A down payment for a construction loan is required because the home is in development and it can’t be used as collateral.
  • What are the requirements for a construction loan? Construction loans require a minimum of 20% down, good credit, a list of project details, and proof you are a qualified builder in the project.
  • What are current construction loan rates? Contact one of our Residential Mortgage Loan Officers at 508.568.3266 or for current construction loan rate information.
  • What’s the difference between a mortgage and construction loan? The term “mortgage” applies to a loan on real estate. The primary difference in terms of lending is that the term “mortgage loan” most often is used in connection with an existing dwelling. A construction loan is made with the expectation that a dwelling will be built on a lot.


Let’s get started on your Construction Loan!