Construction loans are specifically designed for individuals looking to build their dream home. These loans provide financing for the construction process, including land purchase, construction costs, and permanent financing. Construction loans offer flexible terms and interest-only payments during the construction phase.

- Comparative advantages: Specifically designed for financing the construction of a new home. Provides funds in stages as the construction progresses.
- Absolute advantages: Offers flexibility in terms of customizing the home to meet specific needs. Interest-only payments during the construction phase.