The timing of the down payment on a construction loan can vary depending on the specific terms of the loan agreement between the borrower and the lender. However, here are some common scenarios:

  1. At Loan Closing: In some cases, the down payment is due at the time of loan closing. This means that the borrower must provide the down payment funds when they sign the loan documents and the loan is funded.

  2. In Installments: In other cases, especially for larger construction projects, the down payment may be divided into installments and paid at different stages of the construction process. For example, a portion of the down payment may be due when the construction loan is closed, with additional payments due at various milestones during the construction phase.

  3. As Equity Contribution: The down payment on a construction loan is typically considered the borrower's equity contribution to the project. Therefore, the timing of the down payment may also depend on the borrower's ability to secure financing or provide other forms of equity, such as land or property assets.

It's essential for borrowers to review the terms of their construction loan agreement carefully and work closely with their lender to understand when the down payment is due and how it will be structured. This ensures that the borrower can meet their financial obligations and successfully fund the construction project.