Finance
In New Mexico, a 'construction loan' differs from a permanent mortgage in that:
AConstruction loans have lower interest rates
BConstruction loans are short-term loans disbursed in draws as construction progresses, typically converted to permanent financing at completion✓ Correct
CConstruction loans require no down payment
DConstruction loans are issued by the government only
Explanation
Construction loans are short-term (typically 6-18 months) and disbursed in stages (draws) as construction milestones are met. At completion, the borrower typically obtains a permanent 'take-out' mortgage to repay the construction loan.
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