After your loan closes, renovation funds are placed into an escrow account. Contractors are paid through scheduled construction draws as work progresses and inspections are completed. The loan is interest-only during construction, and once the project is finished, you'll typically sell the property or refinance into a permanent mortgage.
The interim construction process starts at closing: acquisition funds and renovation dollars are combined in one short-term note. Renovation money does not go directly to you — it is escrowed and released through draws as your general contractor completes work and passes inspections.
During the 12-month interest-only period, your payments cover interest on disbursed funds. You are not paying down principal like a 30-year mortgage. This keeps carrying costs lower while the property is under construction.
When renovations finish — within the 15-month construction window — you execute your exit: sell the property or refinance into permanent financing. Ryan and Steve map this timeline with you before you close.
How renovation dollars move from escrow to your contractor.
At closing, renovation funds are deposited into a construction escrow account. An initial 10% builder advance may release at closing, with another 10% after required permits are obtained.
Your general contractor completes renovation phases. Draw inspections confirm progress before each release. Up to two draws per month are allowed.
When the project is complete and the interim term ends, pay off the loan by selling the property or refinancing into permanent financing you qualified for at 1% above market rate.
Eligible renovation costs beyond labor and materials.
Related Luminate Bank Interim Renovation Loan guides and renovation programs to compare before you apply.
Define the short-term interest-only bridge product and how it differs from permanent renovation loans.
Occupancy, credit score, and borrower qualification basics.
Financing purchase price and renovation costs in one short-term loan.
Refinancing an existing property and financing major renovations.
Full program overview, LTV grids, draw schedule, and best uses.
Compare interim construction with permanent renovation programs.
After closing, renovation funds are held in a construction escrow account. Contractors are paid through scheduled construction draws as work progresses and inspections are completed. The program also allows 10% initial builder funding at closing and an additional 10% when required permits are provided.
The Luminate Bank Interim Renovation Loan allows up to two construction draws per month — more frequent access than many traditional renovation products.
Once the renovation project is complete, the interim loan is typically paid off by selling the property or refinancing into permanent financing. Borrowers must qualify for permanent financing at 1% above the market rate during underwriting.
Yes. The program allows an interest reserve to be included as part of the renovation financing, helping reduce out-of-pocket expenses while construction is underway.
Ryan & Steve will walk through escrow draws, interest-only payments, and your refinance-or-sale strategy before you commit to an interim construction 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.