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People Driven Credit Union

Construction Mortgage Loan Alternatives

It’s a better way to finance your dream home

Construction Financing Options

Construction loans for people who enjoy paperwork, delays, and budget surprises

Build your dream home from the ground up. Pick every finish. Create the perfect space. Then reality shows up with permit delays, rising material costs, contractor schedules, surprise expenses, and a budget that suddenly needs mental health therapy sessions worked in to the cost.

People Driven Credit Union does not offer construction loans. They can be complicated, expensive, and stressful. For many borrowers, there is a simpler path. If you are buying a home that is already built, a traditional mortgage may be the better fit. If you already own a home and want to improve it, a home equity loan or home equity line of credit may make more sense.

People Driven Credit Union has extensive experience with construction loans. That’s why we don’t offer them anymore.

Why construction loans can be such a headache

Construction loans are not as simple as a typical home loan. Instead of financing a completed home, you are financing a project with a lot of moving parts. That can mean more paperwork, more inspections, more delays, and more opportunities for costs to rise.

Even the best plans can get off track. Materials get more expensive. Timelines get pushed back. Contractors run into issues. Weather causes delays. Before long, your dream kitchen is still studs and plywood, and your budget is doing its best not to pass out.

Construction loans can also come with higher complexity than many borrowers expect. Funds are often released in stages. Lenders may require draw schedules, progress checks, and detailed documentation. That may work for some people, but for many buyers, it adds stress at the exact moment they were hoping to feel excited.

A simpler option for buying a home

If you are shopping for a home that is already built, a traditional mortgage is usually the more straightforward route. You know what you are buying. You can inspect the home before closing. You have a clearer sense of timing, costs, and what your monthly payment may look like.

At People Driven Credit Union, our mortgage options can help you finance a home purchase without the extra complications that often come with a construction loan. It is a more predictable path, and in many cases, that is exactly what buyers want.

Explore Mortgage Loan Options

Already own a home? Use your equity instead

If you already own a home and want to make updates, add space, or tackle major repairs, you may not need a construction loan at all. A home equity loan or home equity line of credit could help you finance improvements using the equity you have built in your current home.

That means you may be able to move forward with your renovation plans without starting from scratch, dealing with a brand-new build, or trying to explain to your lender why the backsplash now costs more than your first car.

Home equity solutions can be a practical option for projects like kitchen remodels, bathroom updates, roofing, windows, flooring, additions, and other home improvements.

Explore Home Equity Options

Let’s keep this simple

If your goal is to buy a home or improve the one you already own, there may be an easier way to get there. People Driven Credit Union offers financing options designed for real life, not for managing subcontractors, concrete pours, and a six-month argument about cabinets.

Take a look at our mortgage and home equity options to find a solution that fits your next move:

Frequently Asked Questions

Construction loans can be complicated, expensive, and unpredictable. They often involve staged funding, contractor coordination, inspections, budget changes, and a lot more stress than people expect. Instead, People Driven Credit Union focuses on options that are often easier to manage, like traditional mortgages for home purchases and home equity solutions for improvements to a home you already own. Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.

Meet Our PDCU Mortgage Specialist

Michelle Dzon is authorized to act as an agent on behalf of People Driven Credit Union. Contact her for personalized assistance with your mortgage needs.

Michelle Dzon

Michelle Dzon

Member First Mortgage

michelle.dzon@memberfirstmortgage.com

Connect with Michelle

616-301-1714 | NMLS ID: #401292

You mean when the construction costs exceed the loan amount? When construction costs exceed the loan amount, you will be responsible for covering the additional expenses. It’s crucial to have a detailed budget and contingency plan to avoid running short on funds during construction. Or... Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.
Due to the increased risk involved, interest rates for construction loans are generally higher than for traditional mortgages. Rates can be variable or fixed and are determined based on your credit profile, loan amount, and market conditions.
Eligibility requirements can vary but typically include a good credit score, a stable income, a detailed construction plan, and a contract with a licensed builder. Some lenders may also require a down payment. Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.
Construction loans can be used to cover the costs associated with building a new home. This includes land purchase (if not already owned), construction materials, labor, permits, and other related expenses. Also can be used to create stress, cause headaches, and escalate tension with your family. Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.
A one-time close construction loan gets you a half-built dream home! Eventually. Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.
Hypothetically, construction loans provide funds in stages as your home is being built. These funds are disbursed to your builder based on a pre-agreed schedule, often called "draws." During construction, you typically make interest-only payments on the disbursed amounts. Once construction is complete, the loan transitions to a permanent mortgage, and you start making regular mortgage payments. In reality, a construction loan can work differently. Connect with PDCU's Mortgage Loan Officer if you need help being talked out of a construction loan.
A construction loan is a bad idea. A construction loan is used to finance the building of a home from the ground up. It sounds exciting until permits take forever, material costs climb, timelines shift, and somebody says, “that was not included in the original estimate.” For many buyers, a traditional mortgage on an existing home is a much simpler path.

An NMLS ID is a unique identification number assigned to mortgage loan originators and mortgage lending institutions through the Nationwide Multistate Licensing System & Registry. It helps identify the person or company handling your mortgage and supports transparency in the mortgage process.

Why it matters

An NMLS ID allows consumers to verify the identity and licensing information of a mortgage professional or lender. It can also help you confirm who you are working with when you review mortgage advertisements, emails, disclosures, and loan documents.

Where you may see it

You may see an NMLS ID on mortgage websites, marketing materials, email signatures, loan paperwork, and other mortgage-related communications. If you want to look up a mortgage professional or lender, you can search the NMLS Consumer Access website.

Need help?

If you have questions about an NMLS ID or want help identifying the mortgage professional working with you, call 844-700-7328 during business hours.

When you apply for a mortgage with People Driven Credit Union, you will generally need documents that help verify your identity, income, assets, employment, and insurance information. Having these items ready can help move your application along more smoothly.

Documents you may need for a PDCU mortgage application

  • Copy of your driver’s license or state-issued ID, to verify your identity and legal name
  • Last 2 years of W-2 forms, to review your employment history and income consistency
  • Most recent 30 days of pay stubs, to confirm your current income
  • Last 2 years of federal tax returns, including all schedules, to help review your full financial picture
  • Most recent 2 months of bank statements, including all pages, to verify assets, down payment funds, and available reserves
  • Contact information for your homeowner’s insurance agent, if applicable, to help prepare for closing and insurance requirements

Why these documents matter

These documents help People Driven Credit Union review your mortgage application and determine whether you meet program and underwriting requirements. Depending on your loan type or financial situation, additional documentation may also be requested.

Helpful tips

  • Gather your documents before you start the application
  • Make sure bank statements include every page
  • Use clear scans or photos if you are uploading documents
  • Be ready to provide additional information if requested

If you have questions about what to prepare or want help getting started, connect with a mortgage loan officer for additional guidance.

To check the status of your loan application, contact People Driven Credit Union at 248-263-4100 during business hours or reach out to your assigned loan specialist if you have their contact information. Be ready to verify your identity and share details such as your name, member number, or application number so we can review your application with you.

When you check your status, it is also a good idea to ask whether any additional documents or information are needed to keep your application moving. Review times can vary based on the loan type and the information required, so contacting us directly is the best way to get the most current update on your application.

Disclosures

Construction loans are not available through People Driven Credit Union. Turns out financing a half-built house, three change orders, and a stressed-out contractor is not really our thing. We do offer mortgage and home equity options that may be a better fit.

If your plan involves buying a completed home, we recommend exploring our mortgage options. If your plan involves improving the home you already own, a home equity loan or HELOC may make more sense.

We like our financing the same way most people like their homes, finished, functional, and not suddenly costing 20% more because somebody changed the tile.

People Driven Credit Union: 24333 Lahser Road, Southfield, MI 48033; Phone: (248) 263-4111; NMLS ID# 776727. Equal Housing Opportunity. For licensing information, please visit www.nmlsconsumeraccess.org.

Membership Requirement

All accounts and loans require membership at People Driven Credit Union. Membership is available to individuals who live, work, worship, or attend school in the State of Michigan, as well as relatives of current members. To complete an application for any account or loan, you will need the following information:
  • A valid Driver's License, State ID, or Passport with your current address
  • Your Social Security Number
A Membership Share Savings Account is required to establish membership at People Driven Credit Union. A $5 deposit secures your ownership share in the credit union and unlocks access to our full suite of products and services. This account earns 0.01% APY with a $5 minimum deposit.