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A construction loan (also known as a "self-build loan") is a short-term loan used to finance the building of a home or another real estate project. The builder or homebuyer takes out a construction loan to cover the costs of the project before obtaining long-term funding.

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Since construction loan brokers tend to work locally, word-of-mouth is often the best way to find a good one. Beyond asking around among friends and neighbors, you can also check in with area banks and credit unions that offer construction lending, or with local builders and contractors who may have.

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