---
title: Construction & renovation | Mortgage Clarity Help Center
description: Project setup, eligible products, the builder budget, and the two-phase payment path.
url: https://www.mortgageclarityplatform.com/help/strategies/construction-type
site: Mortgage Clarity
updated: 2026-09-01
---

## One analysis type, two project shapes

Construction is its own analysis type covering both ground-up single-close construction and renovation lending. Purchase versus refinance is a toggle INSIDE the type, not a separate analysis, because both run on the same engine: an as-completed value, a draw phase, and a two-phase payment path.

## Set up the project

1.  1
    
    Start a new analysis and choose Construction.
    
2.  2
    
    Pick the project type. Ground-Up (Construction-to-Perm) is single-close financing that rolls into the permanent loan when the build completes. Renovation finances the purchase or refi plus improvements against the as-completed value.
    
    ![Project type selection: Ground-Up vs Renovation](https://www.mortgageclarityplatform.com/help-figures/strategies__construction-type__1.png)
    
    Project type selection: Ground-Up vs Renovation Click to enlarge
    
3.  3
    
    Set the transaction to Purchase or Refinance. This gates which products are offered — USDA renovation products are purchase-only, for example.
    
4.  4
    
    Enter the as-completed (after-improved) appraised value. Every renovation limit is calculated against this number, so it drives eligibility as much as it drives the loan amount.
    

## Choosing the product

The product list is filtered by your project type and transaction, and each renovation product carries its own budget ceiling. Those ceilings are the reason a deal moves from one product to another, so they are shown on the selector rather than buried.

1.  5
    
    Ground-up offers Conventional, FHA, and VA Single-Close C2P.
    
2.  6
    
    Renovation offers Fannie Mae HomeStyle and Freddie Mac CHOICERenovation (renovation costs up to 75% of as-completed value; that 75% is a cost cap, not an LTV limit, and both lend up to 95% LTV, or 97% paired with HomeReady / Home Possible), Freddie Mac CHOICEReno eXPress (must not exceed 10% of after-improved value), FHA 203(k) Limited and VA Renovation and USDA Limited (up to $75,000), and FHA 203(k) Standard and USDA Standard (no percentage limit, structural work allowed).
    
3.  7
    
    If the budget exceeds a product's ceiling, that is your signal to move to a Standard product rather than trim the scope.
    
    ![Renovation product list with budget limits shown](https://www.mortgageclarityplatform.com/help-figures/strategies__construction-type__2.png)
    
    Renovation product list with budget limits shown Click to enlarge
    

## The builder budget worksheet

The renovation or construction budget is its own worksheet, separate from closing costs. It meets the mortgage closing costs at the total — the budget is what the money builds, closing costs are what the loan costs — and keeping them apart is what stops a contingency reserve from being read as a lender fee.

1.  8
    
    Enter the line items of the project scope in the budget worksheet.
    
2.  9
    
    Include the contingency reserve and any inspection or draw-administration costs the product requires.
    
3.  10
    
    The worksheet total feeds the loan amount against the as-completed value.
    
    ![The builder budget worksheet](https://www.mortgageclarityplatform.com/help-figures/strategies__construction-type__3.png)
    
    The builder budget worksheet Click to enlarge
    

## The two-phase payment path

The client's payment is not one number. During the draw phase they are paying on the drawn balance; after completion the loan converts and they are paying the permanent payment on the full amount. Show both. A client who only sees the permanent payment is surprised during the build, and a client who only sees the draw payment is surprised at completion.

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