The Interim Construction Loan is a temporary, interest-only financing solution. Once construction is complete, the loan is intended to be paid off by selling the property or refinancing into permanent financing. Borrowers must qualify for the permanent loan at 1% above the market rate during the underwriting process.
The Luminate Bank Interim Renovation Loan is not meant to be your forever mortgage. It funds purchase or refinance plus major renovations during construction with interest-only payments, then is paid off when the project is finished.
Your exit is typically one of two paths: sell the renovated property and use proceeds to pay off the interim note, or refinance into permanent financing. During underwriting for the interim loan, borrowers must qualify for that permanent financing at 1% above the market rate — so the take-out is stress-tested before you start.
Ryan and Steve map the exit at application so final inspection, listing or refinance, and payoff timing do not collide with the construction window.
Choose the payoff strategy that matches your occupancy and investment goals.
After construction, convert to a permanent mortgage. You must qualify at 1% above market during interim underwriting so the take-out is viable before work begins.
Common for fix-and-flip. Complete renovations, list or close the sale, and use proceeds to pay off the interim construction loan.
Close out escrowed renovation funds with remaining draws and final inspection (1004D) so the property is ready for appraisal, listing, or permanent refinance.
The interim interest-only period is temporary. Permanent payments (or sale payoff) begin once the exit closes — not as an automatic conversion without underwriting.
Appraisal, title, and permanent underwriting take time. Do not wait until the last month of the 15-month construction period.
The 1% above-market qualify rule is designed to prove you can carry the permanent loan — review income, credit, and LTV before the interim closes.
If you financed an interest reserve, that balance is part of what you pay off at sale or refinance — include it in the exit numbers.
After completion, permanent options may include conventional, jumbo, or other products. We compare structures so the take-out fits your long-term plan.
Related Luminate Bank Interim Renovation Loan guides and renovation programs to compare before you apply.
Escrowed funds, draws, interest-only payments, then refinance or sell.
Generally 15 months from closing to finish the project.
Renovation/Fix & Flip is an eligible use of this interim program.
Interest reserve may be financed during the construction period.
Full program overview, LTV grids, draw schedule, and best uses.
Compare interim construction with permanent renovation programs.
The Interim Construction Loan is a temporary, interest-only financing solution. Once construction is complete, the loan is intended to be paid off by selling the property or refinancing into permanent financing. Borrowers must qualify for the permanent loan at 1% above the market rate during the underwriting process.
No. It is a short-term interim construction product — typically a 12-month interest-only loan — designed to be paid off after construction via sale or permanent refinance.
Begin planning the take-out before the construction period ends. Permanent qualification is underwritten at 1% above market, so leave time for appraisal, underwriting, and closing.
Yes. Selling the renovated property to pay off the interim loan is an eligible exit — especially common for fix-and-flip investors.
Ryan & Steve will stress-test your refinance or sale take-out at 1% above market for the Luminate Bank Interim Renovation Loan.
All loans are subject to credit and property approval. Luminate Bank Interim Renovation Loan program guidelines, LTV limits, loan amounts, and pricing are subject to change without notice and may not be available in all areas. This is not an offer to enter into an agreement. Information is for educational purposes only and is not a commitment to lend.