When building a new home construction in New Orleans, homeowners often wonder about the specifics covered by a construction loan, particularly when it comes to finishing touches like appliances. Construction loans are designed to cover the costs of constructing a new home or undertaking a significant remodel, but there are nuances in what these loans include.
What is Typically Covered by a Construction Loan?
Construction loans primarily cover hard costs—expenses directly associated with the building structure itself. These include foundational elements like labor, framing, roofing, and essential materials. Structural aspects, such as plumbing, electrical wiring, HVAC systems, and exterior finishes, generally fall within the scope of construction loan coverage. However, when it comes to appliances and other more customizable or “soft” items, the coverage can vary based on the lender’s policies and the specific loan structure.
For construction companies in New Orleans like Nola Build, ensuring clarity in the coverage is essential, as this informs clients about which additional costs they may need to prepare for, such as finishes, fixtures, and appliances. Nola Build’s approach, as seen in its commitment to quality in new home construction in New Orleans, ensures that clients know upfront what to expect financially and functionally from their loan.
Appliances: Are They Covered?
Typically, standard construction loans do not cover the cost of non-essential or optional items, which may include appliances like stoves, refrigerators, dishwashers, and washers/dryers. While there is flexibility in how funds are allocated, it is not uncommon for lenders to view appliances as optional purchases rather than structural requirements, thus excluding them from loan coverage.
If you’re building with a construction company, however, some contractors may offer a more comprehensive package that includes basic appliances. Nola Build, for example, advises clients to discuss their specific needs early on, including any preferences for built-in or integrated appliances that might be part of the final home structure.
Financing Options for Appliances
For homeowners looking to cover appliances without dipping into out-of-pocket funds, additional financing can be a viable solution. Nola Build, for example, offers Buildertrend Financing in partnership with Nelnet Bank, which can provide flexibility for home buyers. Options like these allow for added appliance costs to be included as part of a loan structured separately from the primary construction loan. This supplemental financing can enable the homeowner to fully outfit their home without exceeding the limitations of their original construction loan.
One available option is zero interest with no monthly payments if the loan is paid in full within a set timeframe. Another alternative involves manageable monthly payments with no prepayment penalties, enabling homeowners to integrate appliance purchases more seamlessly into their budget without a significant immediate financial burden.
What Homeowners Should Discuss with Their Lender
Homeowners should be proactive in discussing the inclusions and exclusions of their construction loan with both their lender and builder. This conversation ensures transparency about additional costs they may encounter. Questions to ask include:
- Will appliances be considered part of the covered costs?
- If not, can they be financed under a different arrangement?
- Are built-in appliances eligible for loan coverage?
Each lender may have unique requirements, and some construction companies offer different levels of customization when it comes to including appliances in their pricing. At Nola Build, clients are encouraged to explore all possible options with their construction team to achieve a home that meets their needs and expectations without financial surprises.
Final Thoughts and Moving Forward
Understanding the scope of a construction loan is key to planning effectively and building your dream home without unexpected financial strain. While appliances are typically not included in standard construction loans, options like supplemental financing can bridge the gap, ensuring every corner of your new home is complete. For those seeking new home construction in New Orleans, partnering with Nola Build can make a significant difference. By working closely with experts in both construction and financing, you can create a home that meets all your needs from the inside out.
Ready to bring your dream home to life? Contact Nola Build today to learn more about financing options tailored to cover everything from foundational structures to your desired finishing touches.
